10 Things You Need To Know: October 15, 2024
Key data releases this week include: NAHB Housing Market Index (Thu), retail sales (Thu), industrial production (Thu), and housing starts (Fri).
Haver
October 8, 2024
The NFIB Small Business Optimism Index rose to 91.5 in September, the fifth m/m rise in six months. It has been below the 50-year average of 98 for the 33rd straight month. The NFIB Small Business Uncertainty Index jumped to 103 in September, the highest level on record. There are 33 million small businesses in the United States, which employ 62 million workers.
Haver
October 10, 2024
The Consumer Price Index increased 0.2% (2.4% y/y) during September, the same as during each of the prior two months. The gain compared to expectations for a 0.1% uptick expected in the Action Economics Forecast Survey. Prices excluding food & energy rose 0.3% (3.3% y/y) for the second consecutive month. A 0.2% rise had been expected.
Haver
October 11, 2024
The Producer Price Index was unchanged (1.8% y/y) during September after rising 0.2% in August. Expectations were for a 0.1% rise in the Action Economics Forecast Survey. The PPI excluding food & energy rose an expected 0.2% (2.8% y/y) after increasing an unrevised 0.3% in August.
Financial Times
October 9, 2024
Germany is projected to experience its first two-year recession since the early 2000s, with the economy expected to contract by 0.2% in 2024 following a 0.3% shrinkage in 2023. Economy Minister Robert Habeck attributes the downturn to both short-term factors like inflation and energy costs, and long-term issues such as skills shortages and under-investment in infrastructure.
Bloomberg
October 14, 2024
Goldman Sachs Group upgraded its forecasts for China’s economic growth in 2024 and 2025 after Beijing unveiled a series of measures to shore up growth, including plans for greater public spending announced over the weekend. The bank expects China’s GDP to expand 4.9% this year, up from 4.7% previously. It also lifted its growth prediction for next year to 4.7% from 4.3%.
Barron’s
October 14, 2024
U.S. households’ liquid financial assets totaled $66.4 trillion at the end of 2023. While institutions’ average allocation to alternative investments is 23%, individual investors have only about 5% in privates. According to investment company Brookfield, retail allocations to alternatives should grow by 12% annually over the coming decade, outpacing institutions.
Barron’s
October 14, 2024
The current tax code expires at the end of 2025, when provisions of the Tax Cuts and Jobs Act of 2017 revert to the previous law. Congress is likely to be divided next year, with odds favoring Republicans retaking the Senate while Democrats could recapture the House of Representatives. That will complicate replacing the TCJA regardless of who wins the White House.
Ed Yardeni, Barron’s
October 14, 2024
“The Fed shouldn’t cut the federal-funds rate at its two remaining meetings this year. The bond market has been signaling the same since the Fed’s 50-basis-point cut on September 18. Any additional rate cuts would increase the odds of a stock market melt-up.”
Capital Economics
October 14, 2024
Evidence of residual seasonality in the core PCE deflator means there is a risk that core price pressures will rebound in the new year. That said, the residual seasonality is concentrated in core goods, which have been falling in price this year, suggesting that this is not a serious threat to future rate cuts.