Recession-Hard/Soft Landing
This Special Report examines the post-pandemic evolution of consumption growth, relative equity sector and subindustry performance and recent commentary from consumer-facing companies to assess the likelihood that softer spending among lower-income households will spread to middle- and upper-income households.
The Chinese economic data in its totality was uninspiring in August. Industrial production and retail sales growth decelerated year-on-year and corroborate the message from August’s import and credit growth data that domestic demand remains lackluster.…
The timeliest of the regional Fed manufacturing surveys sent a positive signal about the state of US manufacturing activity in September. The Empire State manufacturing general business conditions index surprised positively. It improved markedly from -4.7…
Subdued demand for credit among Chinese private-sector businesses and households persisted through August. Outstanding loan growth decelerated from 8.7% y/y to 8.5%. Moreover, M1’s contraction deepened, from 6.6% to 7.3%. The lackluster appetite for…
We noted earlier this month that the Fed would be unlikely to deliver a jumbo rate cut without telegraphing it first. President Williams' and Governor Waller’s September 6 speeches offered policymakers one last chance to do so before the customary pre-FOMC…
Preliminary estimates suggest that consumer sentiment improved in September. The headline University of Michigan consumer sentiment index increased from 67.9 to a higher-than-projected 68.5. Both the current conditions and expectations components improved…
The US suffers from enough imbalances to produce a mild recession. Unfortunately, such a recession could lead to a significant bear market in stocks, just as it did during the very mild 2001 recession.
Continued deterioration in labor demand underpins our expectation for a US recession, as it will lead to slower compensation growth, hobbling consumption spending’s main driver. We also previously highlighted that the outlook for bond yields currently hinges…
ECB Governing Council members unanimously voted in favor of lowering the deposit facility rate by 25 bps to 3.50% in September, marking the second cut this year. Moreover, expectations for weaker domestic demand led the ECB to downgrade its growth forecast…