Mixed messages continue to be thrown off by the U.S. economy, and this week we can add retail sales and consumer inflation for May to the list of economic indicators that continue to disappoint analysts’ expectations.
- The three-month moving average on retail sales is running at about half the pace seen over the past 12 months.
- Inflation is showing signs of moderation after a sharp rebound in the first quarter.
- The combination of a somewhat less dovish Fed and diminishing growth and inflation expectations is compressing the Treasury yield to an extent that rivals the lows of the expansion.
- Bank credit has already tightened for CRE and auto lending, while loan demand has weakened pretty much across all segments.
The FOMC failed to blink in the face of widespread market skepticism about the Fed’s projected fed funds rate path as it increased the fed funds target range by a quarter percentage point today to between 1.0 and 1.25%.Read More ›
The 138,000 jobs created last month left behind some confusion and uneasiness about the true underlying strength of the U.S. labor market.Read More ›
We haven’t seen these low levels for jobless claims since the early 1970s, when the labor market was about half the size it is today.Read More ›
The labor market’s resilience and strength were on full display in April.Read More ›