Publications

U.S. Economic Indicators

Consumer prices fell 0.4% in March, the largest monthly decline since January 2015 (up 1.5% from a year ago). The “core” CPI, which excludes food and energy, fell 0.1% in March – the first monthly decline since January 2010 – and is up 2.1% from last year. BLS Report

U.S. News

According to the Financial Times, the Fed has announced it will expand the scope of its bond purchases to include shares in exchange traded funds holding riskier debt, an area of the market once though off-limits to the central bank. While the Fed move will provide much-needed relief to the high-yield bond market, detractors argue that the Fed should instead focus efforts on shoring up municipal bond markets to support state and local governments. FT

Bloomberg reports that OPEC+ and other major oil exporters reached an agreement to cut oil production by 10 million barrels a day after the U.S. and Mexico were able to iron out details that threatened to derail the much-needed resolution to the price war between Riyadh and Moscow. Analysts note, however, that the intended production cuts will not be enough to prevent oil inventories from rising sharply in the coming weeks amid the rapid fall in global energy demand. Bloomberg

U.S. Economic Indicators

Initial jobless claims fell 261,000 to 6,606,000 last week. The four-week moving average rose 1,598,750 to 4,265,500. DOL Report

The University of Michigan Consumer Sentiment Index fell 18.1 points to 71.0 in the preliminary April reading – the largest monthly decline ever recorded – and is down 26.2 points from April of last year. The Index of Consumer Expectations fell 9.7 points to 70.0, while the Current Economic Conditions Index fell 31.3 points to 70.0. University of Michigan

The headline Producer Price Index (“PPI”) for final demand edged down 0.2% in March but is up 0.7% year-over-year. The core — which removes the volatile prices of food, energy, and trade services — also fell 0.2% in March and is up 1.0% from a year ago.  BLS Report

U.S. News

The Financial Times reports that Fed chairman Jay Powell announced Thursday morning that the central bank would unroll additional emergency tools to support the economy, including new loan facilities to deliver $2.3 trillion in credit to small businesses and municipalities. Under pressure to provide more assistance to struggling state and local governments, the Fed has also indicated plans to purchase up to $500 billion of short-term notes directly from U.S. states. FT

U.S. News

According to the Wall Street Journal, nearly a third of U.S. apartment renters missed their rent payments the first week of April, according to data from the National Multifamily Housing Council. While some renters may be temporarily protected from eviction by local and federal housing laws, the figures are an early indication of how many Americans are struggling to make necessary payments during the pandemic. WSJ

The Washington Post reports that major U.S. retailers could be left out of the Fed’s lending program to businesses hurt by the pandemic due to the requirement that firms have investment grade bond ratings in order to participate. Big retailers have argued that they should be allowed to participate given the millions of Americans they employ, while many analysts point out that the stimulus lifeline was not meant to prop up businesses already struggling before the crisis. WaPo

U.S. Economic Indicators

The NFIB Small Business Optimism Index fell 8.1 points to 96.4 in March, the largest monthly decline in the survey’s history, as nine components weakened and one improved. The decline in the headline index was driven by deteriorating expectations for sales and economic conditions as small businesses brace for further disruptions. NFIB Report

The Job Openings and Labor Turnover Survey (“JOLTS”) indicates that the number of job openings at the end of February was little changed at 6.9 million, before widespread coronavirus disruptions. The number of hires was little changed at 5.9 million, while the quits rate was unchanged at 2.3 percent. BLS Report

U.S. News

A new poll by the Financial Times shows that nearly three-fourths of Americans say their family’s income has already been reduced due to the coronavirus pandemic, with nearly half reporting that they would be without any income at all if they were unable to work due to illness. The financial hit from coronavirus is being felt across income groups, suggesting that the pandemic is hitting professional services as well as main street businesses. FT

The Washington Post reports that the White House and congressional leadership are discussing the need for a new assistance package as it becomes clear that the $2 trillion stimulus enacted last month will not be enough to contain the pandemic’s economic impact. The follow-up effort will likely be an extension of programs created by the original Cares Act, and may included extended small business assistance and unemployment aid, another round of direct payments, additional corporate aid, and more funding for the overwhelmed health care system. WaPo

U.S. News

New analysis by the Wall Street Journal and Moody’s shows that over a quarter of U.S. daily economic output has disappeared since the first week of March due to regional coronavirus shutdowns, with the large metropolitan counties under lockdown orders representing a disproportionate share of national output. If the 29% monthly drop in daily economic output were sustained over the next two months, it would suggest a roughly 75% annualized GDP decline in the second quarter. WSJ

According to Bloomberg, Saudi Arabia, Russia, and other major oil producers are trying to negotiate a deal to reduce oil production by 10%, but U.S. participation – a critical component of reducing global output – appears highly tenuous. The world is rapidly running out of oil storage as demand dries up while production continues, with some producers on the verge of having to suspend output completely if the major players are unable to come to an orderly supply cut agreement. Bloomberg