Labor demand remained strong in May, bolstering hirings during the month, the Bureau of Labor Statistics reported on Tuesday. Job openings edged up unexpectedly to 8.14 million from a downwardly revised 7.92 million in April. The increase in job openings is in line with our forecast for another strong ... READ MORE >
interest rates
Manufacturing sector weakens in June
Manufacturing sentiment fell into contraction in June after only three months of barely growing, the Institute for Supply Management reported on Monday. As the Federal Reserve continues to hold interest rates at an elevated level, demand for manufacturing goods has been dampened for most of the ... READ MORE >
June jobs report preview: Beveridge curve implies a balanced labor market as hiring cools
The labor market and inflation have finally come into balance. As Mary Daly, president of the Federal Reserve Bank of San Francisco, said recently, the inflection point where unemployment risks could trump inflation risks “is getting nearer.” Now, the risk is that as the economy cools, hiring will slow ... READ MORE >
Fed’s key inflation gauge continues to cool in May as income increases by 0.5%
The Federal Reserve’s preferred measure of inflation continued to ease in May as the personal consumption expenditures Index remained unchanged on the month and rose by 2.6% from a year ago. The core PCE index, which excludes the more volatile food and energy components, advanced by 0.1% and increased ... READ MORE >
Slower growth raises prospect of a Fed rate cut
Economic growth appeared much softer in the first five months of the year following the release of key economic data on Thursday. Slower-than-anticipated growth should push the Federal Reserve closer to cutting interest rates. Read more of RSM's insights on the economy, manufacturing and the middle ... READ MORE >
Canada’s inflation rises to 2.9% but rate cut remains on the table
Disinflation will be the theme in the Canadian economy for the rest of the year, despite the inflation uptick in May. Inflation rose to 2.9 per cent on a year-over-year basis in May, with a 0.6 per cent monthly increase, Statistics Canada reported on Tuesday. Core inflation measures also rose slightly ... READ MORE >
U.S. harmonized index of consumer prices: A more accurate metric of disinflation?
Part of a central bank’s challenge in setting its policy rate lies in knowing which measure of inflation to follow. From the consumer price index to the personal consumption expenditures index, different measures of inflation can tell a different story. On Friday, investors and policymakers will ... READ MORE >
U.S. inflation expectations are well anchored as Fed nears decision
American inflation expectations remain remarkably well anchored given the price shock of the past two and a half years. Our preferred measure of inflation expectations—the Federal Reserve’s five-year forward, five-year breakeven rate and the five-year forward breakeven index—imply that professional ... READ MORE >
Jobless claims ease as housing starts drop
Initial jobless claims dropped by 5,000 last week to 238,000 yet remained elevated near a 10-month high. For now, the spike in new claims in the previous weeks looks a lot more like a seasonal issue than a deterioration in labor market conditions. In contrast, housing starts fell in May to the lowest ... READ MORE >
Retail sales and industrial production rise in May
The soft rebound in May’s retail sales was good news, suggesting that the economy might reach a soft landing sooner than expected. Total sales increased by 0.1% while the control group, which is the key metric that feeds into gross domestic production calculations, rose by 0.4%. Read more of RSM's ... READ MORE >