Publications

U.S. Economic Indicators

The Chicago Fed National Activity Index declined from +1.11 in August to +0.27 in September. Three of the four broad categories of indicators – employment, consumption, and sales, orders, & inventories – contributed positively to the overall index, while the production & income category contributed negatively. Chicago Fed Report

New home sales declined 3.5% in September to a seasonally adjusted annual pace of 959,000 but were up 32.1% above year-ago levels. The median sales price rose to $326,800 and the inventory of new homes edged up to 3.6 months at the current sales rate. Census Bureau Report

U.S. News

The Wall Street Journal reports that Fed officials and some lawmakers are increasingly calling for a rapid stimulus deal amid fears that further delay could threaten a repeat of the 2008 financial crisis’ lackluster recovery. Officials are concerned that as long as the pandemic holds back consumer spending, prematurely withdrawing fiscal support could allow longer-term recessionary forces to fully take hold. WSJ

According to Bloomberg, the COVID-19 crisis has exacerbated the gap in credit access between large and small firms, mirroring a similar gap between higher- and lower-income households. Divergence between large and small companies threatens to be a lasting consequence of the pandemic recession, as greater market concentration may perpetuate deepening wealth inequality and financial instability. Bloomberg

U.S. Economic Indicators

Initial jobless claims fell 55,000 to 787,000 last week. The four-week moving average decreased 21,500 to 811,250. DOL Report

Existing home sales rose 9.4% to a seasonally adjusted annual rate of 6.5 million in September and were up 20.9% compared to a year ago. Home sales increased in all four major regions on both a month-on-month and year-on-year basis. NAR Report

The Conference Board’s Leading Economic Index (“LEI”) rose 0.7% in September following a 1.4% increase in August. The improvement in the LEI was driven by declining unemployment claims and rising housing permits, though the decelerating pace of improvement implies the economy could be losing momentum heading into Q4. Conference Board Report

U.S. News

The New York Times reports that while the CARES Act allocated $454 billion to back up to $4 trillion in Fed loan programs, those programs have made just $20 billion in loans so far. The failure of the massive Fed lifeline to fully materialize was largely the result of calmer markets after the loan programs were introduced; however, the programs’ effectiveness was also constrained by risk aversion at the Treasury and hesitance by Fed officials to drastically expand the central bank’s role beyond that of a lender of last resort. NYT

According to the Financial Times, shipping costs from Asia to the U.S. have soared over the past month as American companies push to restock depleted inventories ahead of the holiday season and potential winter surge of COVID-19. The recovery in demand for transpacific goods has outpaced the pickup in supply, contributing to ongoing volatility and imbalances in the shipping market. FT