Recession-Hard/Soft Landing
US bond investment takeaways from this week’s PCE and employment releases.
The US Personal Income and Outlays report shows consumption remained resilient in July. Although personal income growth decelerated from 0.3% m/m to 0.2% m/m, spending accelerated from an upwardly revised 0.6% m/m to 0.8% m/m – above expectations of 0.7% m/m.…
Eurozone headline inflation surprised to the upside in August, confirming the signal from the preliminary German and Spanish releases. The year-on-year gauge was unchanged at 5.3% – surprising expectations of a deceleration to 5.1%. Similarly, the 0.6%…
According to BCA Research’s Commodity & Energy Strategy service, current monetary policy settings at the Fed and ECB risk pushing commodity and energy prices lower. Lower prices and higher rates will suppress capex and set the stage for higher inflation…
Stocks should continue to rally in the near term, but investors should prepare to turn more defensive towards the end of the year in advance of a recession in 2024.
Euro Area inflation data surprised to the upside on Wednesday. According to preliminary data, although Germany’s harmonized headline CPI inflation rate fell from 6.5% y/y to 6.4% y/y in August, it nevertheless came in above consensus estimates calling for…
Consensus expectations for the US economy were bleak at the start of the year. In hindsight, this pessimism was excessive: real GDP expanded in the first two quarters of the year (see Country Focus). Similarly, the US Conference Board’s Coincident Economic…
After having sold off in the first five months of the year, the performance of small-cap stocks improved in June and July with the S&P 600 index gaining 13.9% in those two months. A broadening of the US equity rally – which earlier in the year was…
On Tuesday, the Job Openings and Labor Turnover Survey (JOLTS) indicated that the US labor market continues to cool. It showed job openings fell to 8.827 million in July following a downwardly revised 9.165 million in June (down from the earlier estimate of…
On the surface, the latest uptick in the General Business Activity Index of the Dallas Fed’s Manufacturing Survey suggests that manufacturing activity is no longer deteriorating at an accelerating pace. The indicator rose by 2.8 points to -17.2 in August —…