U.S. Economic News
January 28, 2019
U.S. Economic Indicators
The Chicago Fed National Activity Index rose from +0.21 (revised) in November to +0.27 in December. The production and employment indicators contributed positively, while the sales, orders, and inventories category contributed neutrally and personal consumption and housing contributed negatively. Chicago Fed Report
U.S. News
Bob Davis from the Wall Street Journal reports that when U.S. and Chinese trade negotiators begin talks on Wednesday, the role of China’s state-owned companies in its economy will receive a lot of U.S. attention. State owned enterprises have dominated industries that U.S. firms want to enter and will be an obstacle for U.S. negotiators. WSJ
The Wall Street Journal reports that investors blame the stock market’s volatility on the Federal Reserve shrinking its bond portfolio, puzzling Fed officials because there is little volatility in markets where the Fed has actively intervened. The Fed is shrinking its $4 trillion portfolio by allowing Treasury and mortgage securities to mature without replacing them, with about $40 billion expiring per month in recent months. WSJ
According to the Wall Street Journal, a growing number of industrial companies said their sales are softening in China, putting a strong three-year run for U.S. manufacturers in China at risk. U.S. exports to China doubled over the past decade through 2017 to $130 billion per year, as American businesses bet heavily on expanding to China’s growing consumer market. WSJ