Trump 2.0 presents a new challenge to the world economy Austin Or, CFA Highlights US headline inflation perked up to 2.6%YoY due to food, used

Highlight

🔵US inflation softened to 2.4%YoY with loosening energy and housing pressure amid small goods uptick.

🔵Ultra high September NFP and lighter unemployment rate were due to the sharp seasonaly growth of government hires while the private sector openings were imploding.

🔵Sustained strong wage growth shouldered retail sales and was auspicious for US Q3 GDP growth.

Highlights

🔵 The continued flunking of NFP in August and sizable cutbacks of the previous two months prints risk sending US economy reeling despite the unemployment rate ticked down.

🔵 US August CPI relented to 2.5%YoY, but core CPI balked at 3.2%YoY as shelter and transportation costs spiked.

🔵 Encouraging US August retail sales (2.1%YoY) and average hourly wage (3.8%YoY) in August added confidence to the benign US economy standing.

Highlights

🔵US July CPI mellowed to 2.9%YoY, a four month streak of remission, driven by continued goods disinflation.

🔵Market fretted over recession risk fanned by the nosedive of NFP to 114,000 and the jump of unemployment rate to 4.3% in July.

🔵Battered down by manufacturing PMI, the PMI Composite Output Index edged down to a fourmonth low of 54.1 in August.

Highlights

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🔵 Lower NFP gain, slower wage growth and higher unemployment manifest a softer labor market.

🔵 Sharp decline in gas prices and easing shelter price brought down inflation to 3% YoY in June.

Highlights

🔵 May NFP notched 272k growth but may be inflated by the number of new enterprises assumption.

🔵May CPI and core CPI slowed to 0.01%MoM and 0.16%MoM, supporting rate cut bet in September.

🔵Slidding housing starts (-5.5%Mom), sluggish retail sales (+0.1% MoM), increased bankruptcy (+88% YTD) and higher unemployment (4%) are the red flags to US economy.

Highlights

🔵 The elevated interest rate has stifled business activity and labour demand, as indicated by significant slowdown of Q1 GDP growth to 1.3% and the drastic slump of April NFP to 175,000.

🔵 Pandemic excess saving was fully depleted in March, putting consumption into peril and banging US economic growth.

🔵 Wage growth and consumer spending started to lose momentum, and rent price are poised to cool down, offering hopes of further alleviation of inflation.

Highlights

🔵 Hotter than expected March NFP and inflation dialed back June rate cuts odds, and one or no rate cut instead of two cuts come under debate.

🔵 Slowing sign of US economy pokes through with plodding Q1 GDP and proliferating PMI stress.

🔵 At May FOMC, Fed continued to freeze rate at 5.25% to 5.5% and decided to slow Treasury securities reduction to $25 billion monthly, a more gradual pace than anticipated.

🔵 Fed Chairman Powell expected lower inflation over the year, pushed back rate hike as the next policy rate move, and reiterated rate cut as premature when the inflation battle is not over.

🔵 February NFP beat but shadowed by higher unemployment rate and reduced wage growth.
🔵 Retail sales regained growth after January drawdown.
🔵 Shelter and gasoline costs ramped up inflation to stay above 3%.
🔵 Expected NFP attrition and delayed reflection of lower shelter cost will gradually weigh on inflation.
🔵 US faces potential commercial property and corporate debt crisis.