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No Recession In The Data So Far

US OUTLOOK/OPINION

Today's retail sales and Industrial production data added to the a solid April nonfarm jobs report in pointing to fairly strong economic momentum at the start of the 2nd quarter.

  • Certainly, today's data indicates that talk of imminent recession appears overdone. The industrial production index hit a fresh all-time high in April (see chart vs recession periods), while retail sales deflated by CPI has risen in each month of 2022 so far (albeit remains just below the March 2021 high, before CPI readings began soaring).
  • IP, retail sales, and nonfarm payrolls are key components in the NBER's recession dating process (in addition to real personal income / consumption expenditures).
  • GDP nowcasts are likely to be revised up for Q2, and Q1 could be revised up as well based on incoming revised monthly data.
  • Weakness may be coming later in the year, but for now, the data is likely to keep interest rates underpinned and the Fed on course to hike 100bp at the next two meetings.


IP Index And NBER Recession Periods.Source: Federal Reserve, BBG, MNI

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