Publications

U.S. Economic Indicators

The NFIB Small Business Optimism Index declined 3.2 points to 101.2 in January, as seven of the components decreased and three improved. Expectations that the economy will improve dropped ten points. NFIB Report

U.S. News

The Job Openings and Labor Turnover Survey (“JOLTS”), a closely-watched measure of labor market health, indicated there were 7.3 million job openings at the end of December, an all-time high.  Hires edged up to 5.9 million while the quits rate remained at 2.3%.  BLS Report
 
Stephanie Yang of the Wall Street Journal writes that oil-demand weakness in Germany may be a greater threat to oil markets than demand weakness in China. German oil demand, which represents just 2% of global demand, declined on an annual basis for nine consecutive months in 2018 and could spread throughout the rest of Europe, further weakening demand for oil. WSJ
 
The Wall Street Journal reports that U.S. and Chinese negotiators are meeting again this week to develop a broad outline for a trade agreement. Officials meeting in Beijing will attempt to close the substantial gap between the two sides before the March 1st deadline that marks the end of the temporary ceasefire on new tariffs. WSJ

U.S. News

Andrew Ackerman of the Wall Street Journal reports that Federal Reserve governor Randal Quarles stated global regulators must revamp their process of assessing new threats to the financial system, as the financial sector evolves and post-crisis growth peaks. Quarles believes the Financial Stability Board, a panel of international policy makers that was established in 2009, must put more resources into identifying new vulnerabilities now that more than a decade has passed since the financial crisis and the board’s agenda is complete. WSJ

The Wall Street Journal reports that the U.K. economy experienced its weakest growth in six years during 2018 as businesses cut investment due to growing uncertainty about the way the country will leave the E.U. The U.K. is scheduled to leave the E.U. on March 29, but it is unclear whether it will have a transition period maintaining the status quo while a new agreement is negotiated, or will immediately shift to a new regime of tariffs dictated by the World Trade Organization. WSJ

U.S. News

The Wall Street Journal reports that St. Louis Federal Reserve President James Bullard stated the central bank does not need to raise rates any further to achieve its job and inflation goals. The Federal Open Market Committee voted last week to refrain from raising interest rates amid a slowing global economy and a lack of inflationary pressures. WSJ

According to a survey by the Wall Street Journal, economists say another government shutdown would dampen economic growth as well as business and consumer sentiment. According to one respondent, the negative impact on confidence would be larger than the drop in government spending and services. WSJ

The Financial Times reports that Donald Trump has ruled out a meeting with China President Xi Jinping before the March 1 deadline to reach a trade deal, thwarting hopes of an agreement to prevent further tariffs between the two nations next month. Robert Lighthizer and Steven Mnuchin are scheduled to visit Beijing next week for a new round of talks. FT

U.S. Economic Indicators

Initial jobless claims fell 19,000 to 234,000 last week. The four-week moving average rose 4,500 to 224,750. DOL Report

U.S. News

Emre Peker at the Wall Street Journal reports that eurozone economic growth is expected to slow significantly as global trade and the increasing risk of a chaotic Brexit weigh on the currency union. In addition to the U.S.-China trade dispute, Italy’s ballooning national debt and the weakening manufacturing and export outlook in Germany will act as headwinds for the E.U. in 2019. WSJ

According to the Wall Street Journal, despite steady declines in foreign ownership of U.S. government debt over the last decade, there has not been a notable jump in government bond yields because U.S. investors have a strong appetite for government debt. Although domestic investors have picked up the slack due to weaker foreign demand, some analysts say that this trend cannot continue forever and that the U.S. may face issues trying to fund itself in the future. WSJ

The New York Times reports that the USMCA deal, President Trump’s replacement to NAFTA, has little chance of passing Congress without significant changes. While Democrats maintain the deal does not go far enough to protect workers and the environment, Republicans say it goes too far in restricting trade. NY Times

U.S. Economic Indicators

The U.S. trade deficit decreased from $55.7 billion in October (revised) to $49.3 billion in November. The goods deficit fell $6.7 billion while the services surplus decreased $0.3 billion. Census Bureau Report

U.S. News

The Wall Street Journal reports that the U.S.’ chief trade negotiator, Robert Lighthizer, and Treasury Secretary Steven Mnuchin will travel to Beijing early next week to continue trade talks as the March 1 deadline to reach an accord approaches. In previous talks, the Chinese agreed to broaden areas for discussion to include items China previously would not negotiate on for national security reasons. WSJ

According to the Wall Street Journal, OPEC is backing a partnership with a group of 10 nations led by Russia, attempting to manage the global oil market with a pact that would transform the cartel. The pact would formalize the loose union between OPEC countries and the group led by Russia, which includes former Soviet states and Mexico, and the partnership could ultimately benefit the U.S. oil industry. WSJ