Job gains top estimates, unemployment rate holds at 3.6%.  S. employers added more jobs than expected in May and wage growth (while still elevated) moderated slightly.  A sustained softening in wage growth would be welcome by the Fed as it endeavors to tamp down the highest inflation levels observed in 40 years.  The central bank […]

Today, the S&P 500 officially entered a bear market closing down more than 20% from the peak on January 3.  Year-to-date, 2022 has been difficult for investors, offering limited opportunities for positive returns.  In this update, we offer historical perspective on the bear market experience, highlight issues likely to shape the path forward (for better […]

U.S. inflation unexpectedly accelerated to hit a new 40-year high in May.  Record gasoline prices and geopolitical factors threaten to keep inflation high in the coming months suggesting the Fed – which has already committed to half-point rate increases at each of its next two meetings (starting next week) – will need to apply more […]

April retail sales up 8.2% year-over-year; basically flat after inflation.  In spite of elevated inflation, consumers continued to spend at a robust pace in April.  Increased spending on gasoline (+37% YoY) accounted for a large portion of the nominal increase, but strength was also evident in food services and drinking places (+19.8%), brick and mortar […]

U.S. Consumer prices rose more than forecast in April, indicating that elevated levels of inflation could persist longer than expected and keeping the Federal Reserve on an aggressive path of monetary tightening.  The report did show a slight moderation in price increases, but a 0.6% month-over-month increase in core consumer prices (excluding food and energy) […]

Labor market momentum continues; highlights underlying economic strength.  S. employment continued to increase at a robust pace in April and wage growth (while still elevated) moderated slightly.  A sustained softening in wage growth would be welcome by the Fed as it endeavors to tamp down the highest inflation levels observed in 40 years.  The central […]

Fed Statement Side-by-Side: View the Fed Statement comparison Fed raises interest rates by 0.50%, bringing the Fed Funds Rate range to 0.75-1.00%. The market is pricing in a year-end range of 2.75%-3.00%. At its meeting today the FOMC voted unanimously to raise the Federal Funds rate to 0.75-1.00%. We also received clarity on the pace of […]

1.4% GDP contraction. U.S. GDP contracted at an annualized pace of 1.4% in the first quarter compared to analyst expectations for 1.0% growth and decelerating from +6.9% in the fourth quarter. On its face, the headline number is decidedly soft, but underlying details show still-solid household demand and business investment, which aligns with the commentary […]

March retail sales up 6.9% (nominal) and down 1.6% (real) year-over-year.  Increased spending on gasoline (+37% YoY) accounted for more than a third of the nominal increase as several more discretionary-oriented categories slowed or declined.  It is important to note that we are entering a period of extremely difficult prior-year comparisons.  Retail sales grew by […]

Consumer prices rose 8.5% in March marking a fresh 40-year high and bolstering expectations that the Fed will raise interest rates by 0.50% in May.  Many observers believe today’s CPI reading could mark the peak, capturing rising energy and food costs following Russia’s invasion of Ukraine.  Additionally, we have now annualized the last of easier […]

Payroll additions are strong, but miss elevated expectations.  U.S. job growth momentum continued in March and previous reports were revised higher. Yields moved higher after the release, indicating that bond market investors believe this report provides ample justification for the Fed to continue hiking rates. At its March meeting, the median FOMC projection was for […]

FOMC Statement Side by Side Fed raises interest rates for first time since 2018 and signals intentions for 6 more hikes in 2022. At its meeting today the FOMC voted to raise the Federal Funds rate to 0.25%-0.50%. Bullard dissented, preferring a rate of 0.50-0.75%. The statement noted that the Fed will begin reducing its […]

February retail sales up 17.6% (nominal) and 9.7% (real) year-over-year.  Primary drivers of the year-over-year increase include spending on gasoline (+36.4%), restaurant dining (+33.0%) and apparel (+30.6%).  Despite sustained strength in real retail sales growth, heightened inflationary pressures exacerbated by the Russia/Ukraine conflict are posing a threat to consumer demand and therefore economic growth.  In […]