10 Things You Need To Know: October 18, 2022
Key data releases this week include: industrial production (Tue), NAHB Housing Market Index (Tue), housing starts (Wed), Beige Book (Wed), existing home sales (Thu), and leading economic indicators (Thu).
Haver
October 13, 2022
Consumer prices rose 0.4% during September (8.2% y/y) after a 0.1% August rise and stability in July. A 0.2% September rise had been expected in the Action Economics Forecast Survey. Prices excluding food and energy strengthened 0.6% in September, the same as in August. The 6.6% y/y gain remained nearly the highest since August 1982. A 0.5% September increase had been expected.
Haver
October 14, 2022
Total retail sales were unchanged (+8.2% y/y) during September after rising 0.4% in August, revised from 0.3%. A 0.2% increase was expected in the Action Economics Forecast Survey. In the retail control group, which excludes autos, gas stations, building materials & food services, sales improved 0.4% last month (6.6% y/y) after rising 0.2%, revised from unchanged.
Haver
October 14, 2022
The National Association of Realtors’ Fixed Rate Mortgage Housing Affordability Index rose 4.8% (-28.3% y/y) to 104.4 in August after a 5.4% July increase. These gains followed nine consecutive monthly declines. Despite the latest increase, the level of affordability remained down 40.5% from its January 2021 peak. Affordability improved In August as the median home price fell 2.3% (+7.6% y/y) to $396,300. The price peaked at a record $420,900 in June.
Bloomberg
October 16, 2022
The UK pound rebounded from its sell-off after the government of British Prime Minister Liz Truss abandoned much of its economic plan which featured tax cuts financed by massive new borrowing. In early trading today the pound advanced as much as 1.2% to $1.1305.
Barron’s
October 17, 2022
A U.S.-China chip cold war certainly sounds cataclysmic. The No. 2 economy gobbled more than a third of the world’s semiconductors, $212 billion worth, last year, according to IDC. However, the U.S. initiative only affects “leading edge” logic chips with transistors smaller than 16 nanometers. China buys mostly older chips for its vast electronics and automotive industries.
Barron’s
October 17, 2022
An analysis by Deutsche Bank economists shows that 20 U.S. states have recently enacted, or are in the process of enacting, stimulus programs. Such plans cover more than half of the U.S. population, and in aggregate amount to about $31 billion. That is equivalent to roughly a quarter of the third round of pandemic stimulus checks authorized in March 2021.
Barron’s
October 17, 2022
On Friday, noted Doug Ramsey, chief investment officer at the Leuthold Group, the firm’s Very Long-Term Momentum indicator, or VLT, reached an oversold level for the first time since 2016. It’s not a buy signal yet—that happens when the indicator turns up—but it does mean one “is now mathematically possible,” Ramsey writes. “Patience is advised. But this long-term oversold condition should help investors pull the trigger when the time comes.”
Bloomberg
October 12, 2022
The bar for a Federal Reserve pivot away from monetary policy tightening is “very high” amid ongoing strength in underlying inflation, Minneapolis Fed President Neel Kashkari said. “If the economy entered a steep downturn, we could always stop what we’re doing. We could always reverse what we’re doing, if we thought that inflation was headed back down very, very quickly.”
Oxford Economics
October 17, 2022
Supply-chain strains in the U.S. moderated in September. Transportation and price pressures eased, inventories improved, and labor shortages persisted, according to the index. Falling ocean and air freight shipping costs corroborate easing inflation strains in the goods sector and a better balance between demand and supply. Shipping volumes slowed and shipping prices declined as weaker consumer demand paired with reports that retailers were overstocked.