United States
Markets have recouped some of the losses incurred in the aftermath of the July US Employment Situation report. Was the surprise rise in the unemployment rate a false alarm? Supply-side dynamics alone cannot explain the overall rise in the unemployment…
The US fiscal outlook is more unappetizing than it was before the pandemic, but we are not convinced that a difficult day of reckoning awaits. A Treasury market crisis is conceivable, but it is far from inevitable.
Housing starts and permits both disappointed in July. New construction contracted 6.8% m/m, from a 1.1% expansion in June. Permits, which typically lead housing starts, declined 4.0% m/m in July from 3.9% growth in the previous month. Concurrently, the NAHB…
The US unemployment rate has clocked in below 4.5% for 33 consecutive months. However, this historically low rate camouflages nascent cracks in the US labor market. Ahead of recessions, firms usually reduce the pace of hiring before they start…
Preliminary estimates suggest that although consumers’ perceptions of current economic conditions unexpectedly deteriorated in August, they are becoming increasingly optimistic about the future. The University of Michigan current conditions gauge dropped…
According to BCA Research’s GeoMacro Strategy service, while the idea that Donald Trump would allow China to build factories in the US does not mesh with the contemporary media narrative, it would fit the historical track record. The last time that the US had…
Preliminary estimates suggest that US retail sales surprised to the upside in July. They grew by 1.0% m/m from a 0.2% monthly contraction in June, exceeding expectations of a slower 0.4% pace of growth. Sales of vehicles and parts (+3.6% m/m) were the main…
US industrial production fell by a larger-than-expected 0.6% m/m in July, the largest monthly decline so far this year. Capacity utilization also decreased a full percentage point to 77.8% Although Hurricane Beryl distorted these nationwide July numbers,…
Headline and core CPI eased for the fourth consecutive month in July, ticking down 0.1 ppt to 2.9% and 3.2% y/y, respectively. The 3-month and 6-month moving averages continued to edge lower as a result, with the former now reaching a three-and-half-year low…
Consistent with the risk-on environment that has dominated markets so far this year, high yield bonds have returned 4.9% YTD on a total return basis, outperforming both Treasuries (2.9%) and investment grade (3.1%). Nevertheless, our US Bond strategists…