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MNI US Macro Weekly: Consumer Continues To Impress

Global developments helped limit the near-term upside impact on the implied Fed rate path from a week of strong US data.
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Executive Summary:

  • Heavy declines in oil prices and deepening global central bank easing expectations helped limit the near-term upside impact on the implied Fed rate path from a week of mostly stronger-than-expected US data.
  • The healthy data included a firm retail sales beat, a surprise decline for initial jobless claims and industrial production ultimately holding up well considering both hurricane and strike impacts. These saw the Atlanta Fed’s Q3 GDP tracking estimate rise 0.2pp from last week to 3.4%, a fresh high.
  • A lack of major releases and FOMC support for a skip, barring Atlanta Fed’s Bostic (’24 voter) who penciled in only a single cut over the two meetings left this year, sees low odds for such a move.
  • Nevertheless, Fed Funds futures don’t fully price back-to-back 25bp cuts for Nov and Dec meetings, with risks tilted to a skip rather than a 50bp cut since the payrolls report earlier this month.
  • With a limited docket of impactful events on next week’s schedule, focus will be on weekly jobless claims data and flash PMIs.


PLEASE FIND THE FULL REPORT HERE: 

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Executive Summary:

  • Heavy declines in oil prices and deepening global central bank easing expectations helped limit the near-term upside impact on the implied Fed rate path from a week of mostly stronger-than-expected US data.
  • The healthy data included a firm retail sales beat, a surprise decline for initial jobless claims and industrial production ultimately holding up well considering both hurricane and strike impacts. These saw the Atlanta Fed’s Q3 GDP tracking estimate rise 0.2pp from last week to 3.4%, a fresh high.
  • A lack of major releases and FOMC support for a skip, barring Atlanta Fed’s Bostic (’24 voter) who penciled in only a single cut over the two meetings left this year, sees low odds for such a move.
  • Nevertheless, Fed Funds futures don’t fully price back-to-back 25bp cuts for Nov and Dec meetings, with risks tilted to a skip rather than a 50bp cut since the payrolls report earlier this month.
  • With a limited docket of impactful events on next week’s schedule, focus will be on weekly jobless claims data and flash PMIs.


PLEASE FIND THE FULL REPORT HERE: 

Keep reading...Show less