Publications

U.S. Economic Indicators

The ADP Employment Report shows that private-sector employment increased by 135,000 jobs in September, below expectations of 152,000. The services sector added 127,000 jobs, while the goods-producing sector added 8,000 jobs. ADP Report

U.S. News

The Financial Times reports that that the WTO is set to rule this week on the amount of punitive tariffs the U.S. can impose on a range of European goods in retaliation for illegal E.U. aerospace subsidies. The U.S. is seeking to impose tariffs on around $11 billion of European goods, though WTO arbitrators are expected to approve a much lower amount, adding to an already strained trade relationship between the two economies. FT

Nathaniel Taplin reports for the Wall Street Journal that the index for Chinese export orders outperformed the U.S. Purchasing Managers’ Index (PMI) last month, a rare inversion only seen four times since the financial crisis. The two indicators tend to move together, suggesting that the rebound in Chinese manufacturing health may only be temporary. WSJ

U.S. Economic Indicators

The ISM Manufacturing Index declined 1.3 percentage points to 47.8 in September. The Employment Index fell 1.1 percentage points to 46.3, while the New Orders Index rose 0.1 percentage point to 47.3. ISM Report

Construction spending edged up 0.1% in August to an annualized rate of $1.29 trillion. Private construction was essentially unchanged while public construction rose 0.4%. Census Bureau Report

U.S. News

According to the Wall Street Journal, Chicago Fed President Charles Evans stated that the recent Fed rate cuts were necessary to keep the economy on track, and the economy remains generally healthy despite potential risks which may or may not materialize. He expects the U.S. economy to grow at a rate of around 2.25% in 2019 and for inflation to slowly rise to the central bank’s 2% target over the next several years. WSJ

The Wall Street Journal reports that average terms for car loans are growing longer in response to a rapid rise in car prices despite tepid income growth over the past decade. About a third of loans for new vehicles in 2019 had terms of longer than six years — the standard length — while the total volume of U.S. auto-related debt has risen to nearly $1.3 trillion. WSJ

U.S. News

The Wall Street Journal reports that New York Fed leader John Williams is under pressure to explain why the central bank failed to foresee the cash shortage that lead to a spike in repo rates and pushed the effective federal funds rate outside its target range for the first time since the financial crisis. More money market turbulence is expected this week as the third quarter ends and many banks refrain from lending in order to show strong balance sheets, putting additional pressure on the repo market. WSJ

According to the Washington Post, new data from the U.S. Census Bureau shows that more than 1 in 20 Americans now usually work from home, with telework overtaking public transit as the third most popular commuting method in the country. The propensity to work from home increases with age, and there is evidence that U.S. workers may be willing to retire later if their work arrangements are more flexible. WaPo

U.S. Economic Indicators

New orders of manufactured durable goods increased 0.2% in August after rising 2.0% (revised) in July but are down 0.4% compared to a year ago. Excluding transportation, new orders rose 0.5% (up 0.7% from last year). Census Bureau Report

Real disposable personal income rose 0.4% in August after no change (revised) in July while real personal consumption expenditure (PCE) rose 0.1%. The PCE price index was unchanged (up 1.4% Y/Y) and the core price index rose 0.1% (up 1.8% Y/Y). BEA Report

The University of Michigan Consumer Sentiment Index rose 3.4 points to 93.2 in the final September reading but is down 6.9 points from September of last year. The Index of Consumer Expectations rose 3.5 points to 83.4 while the Current Economic Conditions Index rose 3.2 points to 108.5. University of Michigan

U.S. News

According to the Washington Post, U.S. income inequality as measured by the Gini index reached its highest level on record in 2018, despite historically low poverty and unemployment rates. The gap between the rich and poor was widest in wealthy areas along the coasts, while western and midwestern states had more even distributions of wealth. WSJ

U.S. Economic Indicators

The third estimate of Q2 GDP indicates that the U.S. economy expanded at an annualized rate of 2.0%, unchanged from the prior estimate. The latest reading reflects downward revisions to consumer expenditures and nonresidential investment offset by upward revisions to government spending and net exports. BEA Report

The U.S. Census Bureau Advance Economic Indicators Report shows that the goods deficit widened to $72.8 billion in August from $72.5 billion (revised) in July. Meanwhile, wholesale inventories rose 0.4% and retail inventories were unchanged. Census Bureau Report

The National Association of Realtors pending home sales index increased 1.6% in August (up 2.5% Y/Y).  NAR reports that buyers are responding favorably to low interest rates, with home prices expected to appreciate as demand rises in the absence of an increase in supply. NAR Report

Initial jobless claims rose 3,000 to 213,000 last week. The four-week moving average fell 750 to 212,000. DOL Report