Category Archives: Economic Analysis

Bank of Japan gives out some surprise candy

The Bank of Japan (BOJ) has given out some pretty good candy for Halloween. It’s long been known in the economics profession that surprises are what matter most when it comes to policy actions. If everyone expects something to happen, … Continue reading

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GDP surprises to the upside with little fanfare

Real (that is, inflation adjusted) gross domestic product (GDP) advanced at a better-than-expected 3.5% annualized rate in the third quarter, according to the advance estimate from the Bureau of Economic Analysis. That’s a slower pace than the second quarter, when … Continue reading

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QE3, RIP?

As the Federal Open Market Committee (FOMC) has been telling the world for a while, the large-scale asset-purchase program known as QE3 (quantitative easing, part 3) is being wrapped up. Economic conditions have improved sufficiently, and the outlook is better, … Continue reading

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Durable goods point to near-term weakness and a supportive Fed

New orders for durable goods dropped 1.3% in September. Excluding the volatile transportation component, new orders fell 0.2%. Even nondefense capital goods excluding aircrafts orders—a type of core measure of business demand for new equipment—were down 5.4%. The best thing … Continue reading

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Marching toward the QE cliff?

The Federal Open Market Committee (FOMC) is likely to wrap up its asset purchase program that the media has labeled QE3 (quantitative easing, part 3) at its October 29 meeting. Is this a QE cliff from which the economy will … Continue reading

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September’s CPI: More dispersion than inflation

The Consumer Price Index (CPI) increased 0.1% in September, or 1.7% year over year. Energy costs declined, but those declines were offset by increases in housing and food costs. For October, CPI growth could tip negative with the recent deeper … Continue reading

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What’s spooking the markets?

Maybe traders are getting easily spooked in anticipation of Halloween. Every weak data point out of Europe is sending equity indexes and government Treasury yields lower. Flat inflation in Germany and weak retail sales data in the U.S. are the … Continue reading

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For the Fed, the future is now?

The minutes from the Federal Open Market Committee (FOMC) meeting of September 16–17 suggest that the upcoming meeting on October 28–29 will be a doozy. Not only will the FOMC need to grapple with recent data that shows economic growth … Continue reading

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Employment situation normal?

Driven by gains in professional and business services, retail trade, and health care, payrolls increased 248,000 in September. July and August payrolls were revised higher to an aggregate of 69,000. The unemployment rate dropped to 5.9%. According to the household survey, from … Continue reading

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The ECB and the power of two

The European Central Bank (ECB) laid out its asset-purchase program today. The ECB will begin purchasing asset-backed securities (ABS) sometime during the fourth quarter and covered bonds starting in the middle of October. It expects the purchase programs will last … Continue reading

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