Consumer sentiment increased to 63.9 in June, the highest since March as views on current and future economic conditions improved, according to the University of Michigan index released on Friday. While the index has bounced off the bottom of last June, it remains much lower than the pre-pandemic ... READ MORE >
interest rates
Retail sales rise more than expected amid labor market softening
Retail sales rose more than expected in May, pointing to continued resilience in spending that might push the long-awaited recession further down the road. The strong sales figure, though, was reported as layoffs continued to increase last week, government data released on Thursday ... READ MORE >
Fed pauses rate hikes while signaling a tightening bias
The Federal Open Market Committee on Wednesday kept its policy rate in a range between 5% and 5.25% while signaling that it will most likely hike the federal funds rate by 25 basis points at least twice before the end of the year. This implies a possible policy peak of 5.75% later this year. ... READ MORE >
Inflation relief in the pipeline as food, gas and service prices ease
Top-line U.S. inflation is moving back toward levels where it is appropriate for the Federal Reserve to pause in its efforts to restore price stability. With underlying inflation hovering around 3% and 4%, the Fed is well positioned to keep its policy rate steady this week with the confidence ... READ MORE >
Interest rate outlook: Debt ceiling standoff raised the cost of doing business
One cost of the debt ceiling crisis that is lost among most political actors and the public is that the U.S. Treasury will need to refill its coffers. That need to sell debt—$1.1 trillion of it—along with a strong probability of another Federal Reserve rate hike or two during the third ... READ MORE >
The wealth effect and the Great Resignation
Three years after the pandemic upended the American economy, U.S. household balance sheets in general are in good shape. Assets far outstrip liabilities, with household net assets surging over the past decade to nearly $150 trillion last year. Underneath this strength, though, there is a ... READ MORE >
Economy added 339,000 jobs in blowout May employment report
The labor market and the economy it supports will just not go gently into that good night despite policy efforts to cool both. Historic inflation and interest rate shocks have not yet derailed a robust labor market that has averaged an increase of 283,000 jobs over the past three months. ... READ MORE >
About that recession: Resilience now, risks ahead
We have made the case for some time that the “R” word that best describes the American real economy is resilience, not recession. Despite elevated inflation and interest rates, as well as tightening financial conditions and softening demand for loans, the economy has chugged along, thanks ... READ MORE >
Retail sales rise as American consumers stay resilient
Retail sales rose by 0.4% in April following two consecutive months of declines, the Commerce Department reported on Tuesday. While the top-line number came out lower than expected, spending on retail goods continued to show an underlying strength in April. The data should support the ... READ MORE >
Consumer sentiment drops as inflation expectations rise
Consumer sentiment in April plunged to its lowest level since November as views on both current economic conditions and expectations worsened, the University of Michigan reported on Friday. The top-line sentiment index dropped to 57.7 from 63.5 in April. The current conditions and ... READ MORE >