Over the Summer, market focus has turned from concerns about persistently high US inflation, that would force the Fed to keep rates restrictive, to fears over a slowdown in the US economy, that points to more rate cuts.
The fears of a US slowdown have been fuelled by weaker labour market data, particularly an increase in the US unemployment rate to 4.3% in July and a slowdown in non-farm payroll growth to 114,000 from an average of 225,000 in the first half of the year. We still think the US economy remains on a solid footing and estimate the risk of a recession as low.
Headline inflation declined to a three-year low at 2.2% y/y in August due to energy base effects, while core inflation remained sticky at 2.9% y/y like in July. Underlying inflation in the euro area is driven by services inflation where the monthly price increases have been high in the entire year. This dynamic continued in August at 0.4% m/m, seasonally adjusted, which is far from compatible with annual inflation at 2%.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Fed's Goolsbee: If economy deteriorates, Fed will fix itIn an interview with CNBC on Monday, Federal Reserve (Fed) Bank of Chicago President Austan Goolsbee noted that there is a lot going on in the world, which makes things more complicated for them, per Reuters.
Read more »
Chicago Fed President Goolsbee says if economy deteriorates, Fed will 'fix it'Chicago Federal Reserve President Austan Goolsbee spoke Monday morning on CNBC's 'Squawk Box' program.
Read more »
This is now a labor data-first Fed, not an inflation data-first FedThis is now a labor data-first Fed, not an inflation data-first Fed
Read more »
Warren Tells Fed Chair Powell to 'Cancel His Summer Vacation' and Cut Rates NowJake Johnson is a senior editor and staff writer for Common Dreams.
Read more »
Hailee Steinfeld on Beau Society & Teaming up With NeutrogenaBrat summer move over, Hailee says it's bob summer.
Read more »
BMW iX Owner Review: Summer, Summer, SummertimeLonger-range driving is offered in the warmer months by the BMW iX SUV.
Read more »