Inflation

Sweet Economic Indicators

Mar 28, 2024 2 min read

Today's batch of economic indicators was mostly sweet. Q4's real GDP was revised from 3.2% to 3.4% (chart). The Atlanta Fed GDPNow model is projecting 2.1% for Q1-2024. Consumer spending was revised up from 3.0% to 3.3% despite fears that it would be depressed by the resumption of student loan payments. We disputed that notion by observing that real wages and

Ed Yardeni

Market Call: The Fed Put Is Back

Mar 24, 2024 2 min read paid

Last week, the FOMC released its latest quarterly Summary of Economic Projections (SEP) for March. Compared to December's SEP, the committee's participants raised their 2024 median forecasts for real GDP (from 1.4% to 2.1%) and for the core PCED inflation rate (from 2.4% to 2.6%). Their median forecast for the unemployment rate was lowered a bit from 4.1% to 4.0%

Ed Yardeni

The Economic Week Ahead: March 25 - 29

Mar 24, 2024 2 min read paid

The most important economic indicator for the week ahead will be February's PCED inflation rate, which comes out on Friday. The Cleveland Fed's Inflation Nowcast shows the headline and core rates rising 0.4% and 0.3% m/m, and 2.5% and 2.8% y/y. Those results would be about the same as January's, possibly raising concerns that inflation has stalled and

Ed Yardeni

The Pause That Refreshes Spooks Investors

Mar 14, 2024 2 min read paid

The vertical momentum rally that started on October 27, 2023 seems to be losing some of its momentum. Maybe. That's OK with us. We would rather see our 5400 S&P 500 target achieved by yearend, then by mid-year. But as the Rolling Stones observed, "You can't always get what you want." Slowing the pace of the advance this week have been hotter

Ed Yardeni

Core CPI Continues To Moderate

Mar 12, 2024 2 min read paid

Ed Yardeni

Goldilocks Without The Bears

Feb 29, 2024 2 min read

Every now and then, the economy is widely described as being a "Goldilocks" economy. Like Goldilocks' preferred porridge, it is not too hot and not too cold, but just right and bullish for stocks. We often agreed with that assessment, but we also noted that three bears did show up at the end of this cautionary tale. Once again, the economy is just right for Professor Goldilocks,

Ed Yardeni

The Economic Week Ahead: February 26 - March 1

Feb 25, 2024 2 min read paid

The economic week ahead is jampacked with important economic indicators. The ones for January–New Home Sales (Mon), Durable Goods (Tue), and Personal Income (Thu)–were probably weakened by the month's bad weather. The February indicators should show some rebound in economic activity. February's Dallas, Richmond, and Kansas City Fed regional business surveys will be out this week. They should confirm the weather-related rebounds in economic

Ed Yardeni

Not-So-Hot PPI

Feb 16, 2024 2 min read paid

Tuesday's CPI and today's PPI for January were higher than expected. Thursday's retail sales and today's housing starts for last month were both weaker than expected. The new year is starting with hotter inflation and colder economic growth. Nevertheless, these hot flashes and chills should be temporary. In our opinion, inflation continues to moderate and the economy remains resilient. The latter forecast

Ed Yardeni

Inflation Scare

Feb 13, 2024 2 min read paid

Today, January's CPI inflation rate was slightly higher than expected. But the upside surprise was enough to convince investors and traders that the Fed is less likely to cut the federal funds rate (FFR) soon or by as much as they expected over the next 12 months. The 12-month federal FFR futures rose to 4.44% today, up from 3.74% on January 15 (chart). That amounts to

Ed Yardeni

The Economic Week Ahead: February 12-16

Feb 11, 2024 2 min read

Powell & Co. would like to see more evidence that inflation is falling toward their 2.0% target. They should get more of it this week. January's headline and core CPI inflation rates (Tue) should be 0.2% and 0.3% m/m, and 3.0% and 3.8% y/y, according to the Cleveland Fed's Inflation Nowcasting model. We will be focusing on these inflation

Ed Yardeni

Happy Groundhog Day!

Feb 2, 2024 2 min read paid

Punxsutawney Phil, the famous groundhog, woke up this morning and did not see his shadow, calling for an early spring. In the 1979 comedy movie classic, "Being There," Chauncey Gardner, played by Peter Sellers, predicted: "Yes! There will be growth in the spring!" There has been growth in the winter too. Yesterday, the Atlanta Fed's GDPNow model estimate for Q1's growth was

Ed Yardeni

The Economic Week Ahead: January 29 - February 2

Jan 28, 2024 2 min read paid

The FOMC meets Tuesday and Wednesday with Fed Chair Jerome Powell conducting a press conference Wednesday afternoon. We expect no change in the federal funds rate. Powell is likely to push back against the market's expectations of sooner-rather-than-later rate cuts by observing that financial conditions have eased and the economy is stronger than expected, thanks in part to productivity. The first week of each month tends to be

Ed Yardeni

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