The headline-grabbing presidential election took center stage this week, and the outcome is still reverberating through the financial markets. Stocks continued to stage an unprecedented post-election rally through Friday although the immediate spike in bond yields was entirely erased towards the end of the week. Commentators and pundits will spend weeks on end debating what…
The vibe-recession may still be alive and well, but incoming data, if sustained, is sure to loosen its grip. While economic data may not be the best measure of happiness, they certainly look more upbeat than how people are feeling. That divergence has persisted for some time now and, unsurprisingly, the gap is beginning to…
All eyes will be laser-focused on next weeks jobs report, the key monthly data print that is the primary mover of markets and perceptions about the health of the economy. Unfortunately, the report will be marred by external shocks hurricanes and a Boeing strike that will obscure the true strength or weakness in underlying fundamentals….
The week data calendar confirms that the economy ended the third quarter on a strong note, belying the notion it is running out of fuel. Starting with the robust jobs report for September just about every subsequent indicator for the month has been stronger than expected. The exception is industrial production, as the twin blows…
Following the blockbuster jobs report last week, there was extra scrutiny placed on this weeks inflation reports. The overriding question is whether the data would validate or undercut the Feds rebalancing of risks, from worrying about elevated inflation to concern over a deteriorating job market. The jumbo half-point rate cut taken at the mid-September policy…
One big external shock was taken off the table late Thursday, when the longshoremen agreed to suspend their strike until January, allowing negotiations to continue. With the ports reopening, the prospect of pandemic-era supply disruptions, steep price hikes on many goods and widespread furloughs have been derailed, at least for several months. Even so, the…
The Federal Reserve with its jumbo half-point rate cut dominated the headlines last week, spurring a panoply of questions as to whether it was the right size, how fast will it go down and where will it end. This week, the focus shifted back to the economy where developments will ultimately provide answers to those…
With the Feds aggressive half-point rate cut this week, the direction of travel has been set in motion, and a speed limit dialed into the dashboard. To be sure, monetary policy is not on cruise control; depending on road conditions, the speed limit can be adjusted faster or slower. For now, Fed officials expect to…
The debate over whether the Fed will cut rates by 25 or 50 basis points at next weeks FOMC meeting is still unsettled, but the odds for the smaller cut have increased following a stronger-than-expected inflation report this week and, to a lesser extent, further evidence that the labor market is holding up. For sure,…
Amid this summers sweltering heat, a cooling trend is wafting through the labor market. The chilling effect is just what the Fed ordered as long as it doesn’t result in a freeze. As Fed Chair Powell noted in a recent speech, we don’t seek or welcome a further cooling in labor market conditions. The August…