Wage growth during the current business cycle has been weak compared to the past several economic expansions. The May U.S. employment report implied a growth rate in wages of 3.1%, which was accompanied by a 2.73% three-month average annualized pace, pointing to broader deceleration in the growth of overall wages. Both metrics have declined for the past ... READ MORE >
Joe Brusuelas
FOMC preview: Fed positions for rate cut later this year
The Federal Reserve is on the precipice of a major shift in policy as the economy, hiring and wages slow amid a backdrop of muted inflation. As risks to the economy proliferate, the central bank is well-positioned to await the outcome of the G20 meeting later this month, which may determine future trade relations with China; the Fed will monitor the ... READ MORE >
The RSM Brexit Stress Index–Assessing the political damage
The RSM Brexit Stress Index closed lower for the second week in a row, following the resignation of Prime Minster Theresa May last month and an uncertain political future for the U.K. The composite index—which measures economic uncertainty surrounding Britain’s departure from the European Union—moderated to 0.24 on Friday from 0.40 at the end of last ... READ MORE >
Will May’s slow jobs growth spell a Fed interest rate cut? Joe Brusuelas offers insight in a WSJ podcast
The U.S. economy added only 75,000 jobs in May. Does that lend credence to the likelihood that the Federal Reserve is preparing for a rate in the near term? RSM US Chief Economist Joe Brusuelas weighs in on this podcast with the Wall Street Journal's Charlie Turner on Friday, June 7. "The weakness in goods-producing and manufacturing (jobs) has now ... READ MORE >
RSM Brexit Stress Index eases amid May’s departure
The RSM Brexit Stress Index closed at 0.42 on Friday, moderating from 0.60 at the end of last week, as Prime Minister Theresa May officially exits her post at Tory leader. The composite index—which measures economic uncertainty surrounding Britain’s pending departure from the European Union—remains within a range of normality in terms of asset-price ... READ MORE >
Jobs report clunker puts June rate cut on the table
An interest rate cut at the June 19 Federal Reserve meeting is now on the table as firms pulled back significantly on hiring in May. The weak hiring report is likely due to the uncertainty tax linked to trade policy out of the White House that has been placed on the economy. While topline hiring showed a net gain of 75,000 jobs, there was noticeable ... READ MORE >
What constitutes a trade war? You’re looking at it
Many who have watched the growing trade dispute between the United States and China, the world's largest trading partners, have been fast and loose with terminology since tensions began to heat up in early 2018. While we have remained cautious, now there is no mistake: A trade spat initiated by the United States last year with the imposition of tariffs on ... READ MORE >
A pivot point for agriculture : Can agritech save farming?
The U.S. agriculture sector has been hard hit in recent years due to changing global demand and the onset of the Trump administration’s trade conflicts. Growth of real net farm income in 2019 dollars has been negative in nine of the past 19 years. Since 2011 the major agriculture states in the Midwest have experienced negative growth, while California—the ... READ MORE >
RSM Brexit Stress Index shows increase in financial market stress
The RSM Brexit Stress Index finished the week at 0.34, up from last week’s close at 0.02. Although remaining within a range of normality in terms of asset price movement and volatility, financial market stress is nevertheless inching higher again. Until three weeks ago, the index, which measures UK economic sentiment surrounding Britain's pending ... READ MORE >
Fed policy bumps up against muted inflation expectations: Data point to ‘lower for longer’ inflation
The Federal Reserve’s April policy meeting featured an in-depth discussion around risks to the economic outlook from falling inflation and current inflation expectations. The central bank’s current policy framework has set a 2 percent inflation target. Meanwhile, core inflation has eased to 1.6 percent, well below the Fed’s target, while inflation ... READ MORE >