The Economy’s Momentum Continues to Wane
|U.S. Review
The Economy’s Momentum Continues to Wane
- Consumer price inflation eased up in September. On a year-ago basis the trend remains firm, but the weaker print for September reduces the risk of inflation breaking meaningfully higher and threatening the Fed’s easing bias.
- The inflation side of the Fed’s mandate remains under control, but job openings for August hinted at a crack in the labor market. Openings fell for a third straight month and are down 7.5% since January.
- Optimism among small businesses eroded a bit more in September, with the NFIB index falling to 101.8. Fewer businesses expected higher sales or to hire more workers.
Global Review
Light at the End of the Brexit Tunnel?
- The Brexit rollercoaster carried on up and down the track over the course of the week, with a full pendulum swing from dashed hopes for a deal to a surge in optimism. The two sides appear to have moved substantially closer to reaching a deal, but we caution that any deal is still subject to the approval of U.K. and E.U. Parliaments, which is hardly a sure thing.
- There were limited releases from key international economies this week. U.K. activity figures suggest the economy avoided technical recession in Q3, while German activity figures confirmed what we already knew: the manufacturing sector is in the doldrums.{
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