10 Things You Need to Know: December 27, 2023
Key data releases this week include: FHFA House Price Index (Tue), trade balance (Thu), and pending home sales (Thu).
Haver
December 21, 2023
Real GDP growth in the third quarter was revised lower to 4.9% (SAAR) from 5.2% reported last month. The gain followed a 2.1% Q2 increase and a 2.2% Q1 rise. It remained the strongest increase since the fourth quarter of 2021 and left y/y growth at 2.9%. The Action Economics Forecast Survey expected no change from last month.
Haver
December 21, 2023
The U.S. Leading Economic Index fell 0.5% in November (-7.6% y/y) after a 1.0% October decline, according to a report released today by The Conference Board. A 0.4% decline had been expected in the Action Economics Forecast Survey. The November index of 103.0 was the lowest level since May 2020. Six of the ten indicators contributed negatively to the index.
Haver
December 22, 2023
New single-family home sales slumped 12.2% m/m (+1.4% y/y) in November following an upwardly revised 4.0% monthly decline in October. The number of units sold was 590,000, the lowest since November 2022. The Action Economics Forecast Survey expected sales of 685,000. Sales were below the recent high of 1.029 million in August 2020.
Haver
December 22, 2023
The headline PCE price index unexpectedly fell 0.1% m/m (+2.6% y/y) in November, after an unchanged reading in October. An unchanged reading for November had been expected. The core index edged up 0.1% m/m (3.2% y/y), also below expectations.
FT
December 22, 2023
Economic growth in the eurozone could be set to slow next year due to lower public spending, economists have forecast. Tighter budgets will be phased in from next year after being suspended since the pandemic hit in 2022, which could place pressure on the European Central Bank to loosen monetary policy.
Reuters
December 20, 2023
The People’s Bank of China left benchmark lending rates unchanged at its meeting Wednesday, keeping the one-year loan prime rate at 3.45% and the five-year LPR at 4.20%. All 28 market watchers surveyed by Reuters expected no change in the one-year or five-year LPRs. They now expect Beijing to ramp up monetary easing in the new year as the economy slows.
FT, Reuters
December 19, 2023, December 19, 2023
The Bank of Japan’s decision to hold off on a rate rise sent the yen lower against the dollar, falling 0.5% to its lowest level in nearly a week on Tuesday. Policymakers held rates at -0.1% and made no changes to their policy guidance, indicating the end of its ultra loose monetary policy may be nowhere near.
Barron’s
December 25, 2023
At 14 times the lowered earnings estimate for the coming 12 months, the S&P 600 trades 28% lower than the S&P 500’s 19.4 times, bringing small-caps close to the cheapest they have been versus large-caps in the past decade, according to FactSet.
Bloomberg
December 21, 2023
Angola announced it is leaving OPEC following 16 years of membership amid a dispute over oil production quotas, while the cartel tries to buoy global prices. Angola had rejected a reduced output limit imposed by the leaders of the cartel to reflect the country’s dwindling capacity. The decision to leave is not entirely unexpected given the infighting in recent months, and while it may stoke concern about the group’s cohesion, it won’t affect the outlook for production.