Observations
Weak labor market and brilliant reporting.
Is there a contradiction?
Over the past year we have been witnessing rising unemployment on the back of skyrocketing consumption and corporate profits. The picture gets different, though, if we separate several large tech companies and the rest of the economy.
The first 50bp rate cut. September, 2007
Intentionally or not the Fed Chair Powell is stepping onto the path Ben Bernanke was exploring 17 years ago. We found it useful to look back and take a snapshot of the 2007 business environment and see the way investors and regulators assessed the situation.
Consumer sentiment. How good is it?
Probably, the most intriguing question about the US economy is why consumer spending is so resilient despite high rates and rising unemployment. The most recent July readings show acceleration in the unemployment uptrend and, at the same time, near-record-low savings rate reflecting spending frenzy of US consumers.
2024 Q2 reporting—consumer spending trends
Consumer spending is probably the most important gauge of the current economic conditions. Household savings are returning to the pre-pandemic levels, and that can affect the economy substantially. We selected commentaries various companies made on the matter.
US Retail Sales. Fresh take
The Retail Sales gauge that came in on Tuesday, July 16th rose by most in three months.
It should be kept in mind, however, that the retail sales expectations are only made based on the seasonally adjusted figure. The non-adjusted one does not look so bright.
UK Inflation
At its meeting on June 20th the Bank of England
took a decision to keep the key rate unchanged. Many had expected the first
cut, though, as the day earlier the UK headline inflation came in at the 2%
level for the first time since pandemic.