Industrial Production (Aug.)

The 0.4% m/m rise in industrial production in August lifted it back above its pre-pandemic peak, but was nevertheless weaker than we had expected and suggests that the industrial recovery is losing steam. With the Delta variant causing renewed disruption to global supply chains and Hurricane Ida weighing on oil production, a further slowdown looks likely in September.
Andrew Hunter Senior US Economist
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US Economics Weekly

Delta impact evident in both CPI and retail sales

While the data released this week showed retail spending picking up in August as price gains moderated, the figures are still consistent with a sharp slowdown in consumption growth in the third quarter while underlying inflationary pressures continue to build.

17 September 2021

US Economics Update

Rising cyclical pressure will keep inflation elevated

The spread of the Delta variant domestically has triggered a temporary reversal in the reopening inflation in high contact services, but its spread across other parts of the world will intensify supply shortages and drive goods prices higher. At the same time, transportation costs are soaring, energy prices are proving more resilient than we expected and cyclical inflation is still building. The upshot is that, while price inflation will fall next year, we expect it to rebound to well above 2% in 2023.

16 September 2021

US Data Response

Retail Sales (Aug.)

Even though the 0.7% rise in headline retail sales in August was much better than expected, the details were far less positive, with big downward revisions to previous months, while the rise in online and grocery store spending, which contrasts with stagnant spending at bars and restaurants, suggesting that Delta fears are playing a key role.

16 September 2021

More from Andrew Hunter

US Economics Update

Delta not the main factor weighing on growth

With authorities having shown no appetite to reimpose restrictions on activity and new virus cases now levelling off, the Delta variant is still unlikely to have as big an impact on the economy as previous waves. That said, it adds to a range of other factors weighing on demand, while the renewed disruption to global supply chains could make shortages worse and keep upward pressure on prices.

13 September 2021

US Data Response

US International Trade (Jul.)

The narrowing in the trade deficit to $70.1bn in July, from a revised $73.2bn, suggests that the drag on GDP growth from net trade in recent quarters will be partly reversed in the third. We’ll be online after the August jobs release on Friday to discuss the data and take questions. Registration details here

2 September 2021

US Economics Update

Monetary Indicators Monitor (Jul.)

The latest data show that growth in the main monetary aggregates is slowing even before the Fed starts tapering its monthly asset purchases, although it remains strong by historic standards. We’ll be online after the August jobs release on Friday to discuss the data and take questions. Registration details here

1 September 2021
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