Publications

U.S. Economic Indicators

Consumer prices rose 0.4% in August (up 1.3% from a year ago). The “core” CPI, which excludes food and energy, rose 0.4% and is up 1.7% from last year. BLS Report

U.S. News

The Wall Street Journal reports that a second round of direct stimulus checks and extended unemployment aid before November is growing increasingly unlikely as bipartisan talks in Congress stall. After a slimmed-down stimulus bill was voted down in the Senate on Thursday, lawmakers will have another chance to negotiate an agreement when the House returns next week. WSJ

According to the Financial Times, companies raised $210 billion in corporate bond sales last month – a record-high for the month of August – in an effort to load up on debt before the November presidential election generates more volatility in financial markets. Record-low interest rates and Fed support have contributed to strong demand for new corporate issuances, though issuers worry that debt deals may become more difficult later this year if the presidential election is contentious or virus cases surge again in colder winter months. FT

U.S. Economic Indicators

Initial jobless claims were unchanged at 884,000 last week. The four-week moving average fell 21,750 to 970,750. DOL Report

The headline Producer Price Index (“PPI”) for final demand rose 0.3% in August but is down 0.2% year-over-year. The core – which removes the volatile prices of food, energy, and trade services – rose 0.3% in August and is up 0.3% from a year ago. BLS Report

U.S. News

The Washington Post reports that months into the Main Street Lending Program, uptake remains low, with lawmakers split on whether to relax the program’s requirements to encourage participation or seek out alternative avenues for small- and medium-sized business support. The program has issued just $1.2 billion of its $600 billion loan capacity, and while some lawmakers believe shifting all liability to the Fed will incentivize greater bank participation, it also raises the likelihood that banks will make riskier loans that will eventually go bad. WaPo

U.S. Economic Indicators

The Job Openings and Labor Turnover Survey (“JOLTS”) indicates that the number of job openings rose 617,000 to 6.6 million in July. The number of hires fell 1.2 million to 5.8 million, while the quits rate edged up to 2.1 percent. BLS Report

U.S. News

Tory Newmyer writes for the Washington Post that while the Senate is preparing to vote on a slimmed-down $500 billion stimulus package on Thursday, the bill is not expected to advance due to a lack of support from House Democrats and even some Republicans. There are few indications that bipartisan talks are close to reviving, though many Wall Street firms continue to assume an imminent stimulus package in their economic forecasts, likely overestimating the pace of recovery. WaPo

According to the Financial Times, a recent survey by the American Chamber of Commerce found that just 4% of U.S. companies operating in China have plans to relocate any production capacity back to the U.S., indicating that businesses are not overly concerned about the possibility of U.S.-China decoupling. More than 70% of companies indicated they have no plans to relocate any manufacturing capacity out of China, though the rapidly deteriorating U.S.-China relationship was cited as companies’ largest concern for the first time in the survey’s history. FT

U.S. Economic Indicators

The NFIB Small Business Optimism Index rose 1.4 points to 100.2 in August as seven components improved, two weakened, and one was unchanged. Current job openings and plans to increase employment improved, while expectations for future sales and overall economic conditions declined. NFIB Report

U.S. News

The Wall Street Journal reports that Q2 was the best quarter for the mortgage market since at least 2000 as lenders issued $1.1 trillion in home loans. The housing market has proven to be one of the few bright spots in the U.S. economy, though analysts note that most of the increase in loan activity has been from refinancings, which are unlikely to stimulate much new activity in the broader economy. WSJ

According to the Financial Times, banks are growing increasingly concerned about their ability to recoup loans secured against commercial property as hotels and office buildings remain empty months into the public health crisis. Criticized loans rose 62% in Q2 as disruption in the property sector begins to impact measures of financial strength for major U.S. banks. FT

U.S. Economic Indicators

Initial jobless claims fell 130,000 to 881,000 last week. The four-week moving average fell 77,500 to 991,750. DOL Report

Nonfarm business sector labor productivity increased 10.1% in Q2 (revised) and was up 2.8% compared to a year ago. Hours worked decreased 42.9% in Q2 and unit labor costs rose 9.0%. BLS Report

The ISM Services Index fell 1.2 points to 56.9 in August, indicating continued growth in the services sector but at a slower rate than the prior month. The New Orders Index declined 10.9 points to 56.8, while the Employment Index rose 5.8 points to 47.9. ISM Report

The U.S. trade deficit increased from $53.5 billion (revised) in June to $63.6 billion in July. The goods deficit rose by $9.3 billion while the services surplus fell by $0.8 billion. Census Bureau Report