Foreign direct investment continues be a source of economic strength for the United States. Rising rates, a strong dollar, an innovative economy as well as the rule of law continue to attract significant capital into American-based corporations. That flow of capital has become so strong, in fact, that ... READ MORE >
Joseph Brusuelas
RSM’s economic outlook for Canada in eight charts
Economies respond to financial conditions, which are determined by market expectations for monetary policy. With inflation still elevated and demand surging in Canada, we expect the Bank of Canada to continue raising interest rates to cool an overheating economy. While the Canadian economy may ... READ MORE >
How remittances bolster emerging economies
Remittances play a well-known but little discussed role in emerging markets around the world. Low-income countries like El Salvador are heavily dependent upon such payments from families and friends who work in other countries, with roughly 20% of gross domestic product coming from remittances. The ... READ MORE >
Financial conditions and Canada’s real economy
Tightening financial conditions are hurting the Canadian economy to the point where the rising risk of a recession and a housing contraction much larger than anticipated cannot be discounted. Although we expect the Bank of Canada to raise its policy rate to a peak of 4.75% early next year, after ... READ MORE >
FOMC decision: Fed lifts policy rate to range of 4.25% to 4.5%
The Federal Reserve on Wednesday laid the groundwork for an eventual pause in interest rate increases early next year, even as it indicated it intends to continue lifting rates into a slowdown. The projection of a slowdown, which is in the Summary of Economic Projections released after the Federal ... READ MORE >
November CPI: Easing inflation amid surging housing costs poses dilemma for Fed
On first sight, the U.S. November consumer price index would suggest relief among policymakers following the second straight inflation report that came in lower than expected. With the top-line figure easing to a 7.1% annual increase and core inflation falling to 6% on a year-ago basis, the data ... READ MORE >
Did fiscal spending go too far? Assessing the global economy.
Fiscal responses by governments around the world during the pandemic were unprecedented. Many governments put forward anywhere between 20% and 30% of gross domestic product in spending to mitigate the impact of economic shutdowns. Now, after months of elevated inflation and surging interest rates, ... READ MORE >
FOMC preview: Policy rate to increase by 50 basis points
Two weeks after Federal Reserve Chairman Jerome Powell pointed to slower interest rate increases, the central bank is poised to do just that when the Federal Open Market Committee meets this week and raises its policy rate by 50 basis points. Such an increase would follow a series of 75 basis-point ... READ MORE >
U.S. economic outlook: Recession on the horizon
Our baseline forecast for the American economy next year calls for a mild recession by the second half of the year as the impact of higher interest rates sets in. For some time, our forecast has included a 65% probability of recession over the next 12 months. Next year, we expect a 0.1% decline in ... READ MORE >
U.S. jobs report: Rising wages pose a problem as hiring remains strong
Expectations that wage growth would slow were dashed inside the U.S. jobs report for November as average hourly earnings increased by 5.1% on a year-ago basis and by 0.6% on the month in addition to being revised higher in October. The primary policy takeaway from the report is that the Federal ... READ MORE >