As much of the world eases COVID restrictions, we believe that the worst of domestic supply chain issues are in the rear-view mirror. Yet rising infections in some countries, along with geopolitical tensions, could delay a full return to normal. After a dip in January because of the omicron ... READ MORE >
Covid-19
FOMC’s policy decision: Rate hike, balance sheet reduction, revise down forecast, repeat
Policy normalization at the Federal Reserve took a giant step forward on Wednesday as the Federal Open Market Committee hiked the federal funds rate by 25 basis points to between 25 and 50 basis points while slashing its growth forecast and increasing its estimate of inflation. The announcement ... READ MORE >
U.S. retail sales lag inflation in February amid rising energy prices
Retail sales growth fell behind inflation increases in February, posting a weak 0.3% increase, as growth slowed down in most categories except gasoline stations. Consumer rationing because of rising gasoline prices already took place before the Russian invasion of Ukraine. Excluding sales at the gas ... READ MORE >
Service sector moderated amid rising prices and labor crunch
The service sector registered slower growth in February as inflation and labor shortages remained top concerns, according to a report from the Institute for Supply Management on Thursday. The services purchasing managers’ index declined 3.4 percentage points to 56.5 on the month, but for the 21st month ... READ MORE >
Chart of the day: Initial jobless claims continue to decline
Initial jobless claims last week continued to trend down toward the pre-pandemic level after a period of temporary increases because of the omicron variant. New filings for the week ending Feb. 19 dropped to 232,000 from 249,000 in the prior week, only 14,000 claims away from the 2019 average. The ... READ MORE >
Chart of the day: Consumer confidence slides
Consumer confidence ticked down in February as expectations for the economy softened, according to data from the Conference Board on Tuesday. High inflation—which might continue to rise because of the Russia-Ukraine conflict—remains a top concern for consumers, dampening spending plans and raising ... READ MORE >
RSM US Supply Chain Index: Omicron pauses improvement
Stress in the U.S. supply chain increased in January as the omicron surge temporarily put some parts of overall production to a halt. While we still expect stress on U.S. and global supply chains to improve this year, geopolitical tensions associated with the imminent Russian incursion into Ukraine ... READ MORE >
Chart of the day: U.S. housing permits reach 15-year high
Housing supply showed no sign of slowing down in January despite a decrease in starts because of the omicron surge. The one-time impact—which has subsided quickly—caused housing starts to decline by 4.1% in January to 1.638 million from 1,708 million in December on an annualized rate. But housing ... READ MORE >
Initial jobless claims rise unexpectedly
New filings for jobless claims rose unexpectedly last week because of large jumps in Missouri and Ohio. New claims advanced to 248,000 from an upwardly revised 225,000 the week before, according to data from the Labor Department on Thursday. The upside surprise was quite large as the market had ... READ MORE >
Chart of the day: U.S. industrial production rebounds
A colder-than-normal January pushed industrial production up significantly as utility production rose 9.9% on the month—the highest rate on record—according to a report from the Federal Reserve on Wednesday. Overall industrial production volume, as a result, advanced by 1.4% in January from a decrease ... READ MORE >