US Housing Market Outlook Housing is at a crossroad The housing recovery is at a crossroad. We expect looser supply conditions to drive a moderation in house price gains over the next year. But our forecasts assume that declining investor demand will... 27th March 2014 · 1 min read
US Economics Update Will the long-term unemployed ever get back to work? If there is little prospect of getting the long-term unemployed, who account for an unusually large share of the overall jobless rate, back into work then wage growth could accelerate faster than the... 27th March 2014 · 1 min read
US Employment Report Preview Weather effects starting to reverse The weather didn't quite return to seasonal norms in March, but it was nowhere near as bad as it was between December and February. We have pencilled in a gain of 200,000 in payroll employment in... 27th March 2014 · 1 min read
US Data Response Durable Goods (Feb.) The 2.2% m/m rebound in durable goods orders in February, which was more than double the consensus estimate of a 0.8% m/m gain, was largely due to a big bounce back in the transportation component... 26th March 2014 · 1 min read
US Data Response Conf. Board Consumer Confidence (Mar.) The rebound in the Conference Board measure of consumer confidence to a six-year high of 82.3 in March, from 78.3, reflects mainly a reversal of the weather effects from a month ago. With equity... 25th March 2014 · 1 min read
US Housing Market Data Response Case-Shiller Prices & New Home Sales (Jan./Feb.14) The rapid, double-digit increases in house prices are unlikely to continue now that housing market supply conditions are loosening. 25th March 2014 · 1 min read
US Chart Pack Threat from twin deficits quietly fades The current account and Federal budget deficits have narrowed markedly over the past few years, indicating that the US economy is the closest it has been to both internal and external balance in more... 25th March 2014 · 1 min read
US Economics Focus Medical inflation is coming back to life A rebound in medical inflation from recent 40-year lows will add to a wider strengthening in price pressures to push core PCE inflation above the Fed’s 2% target next year. This may prompt the Fed to... 24th March 2014 · 1 min read
Canada Economics Weekly Demographics to weigh on economic growth and interest rates In his speech last week, Bank of Canada Governor Stephen Poloz argued that the legacy of the financial crisis and demographic changes can explain Canada's recent lacklustre economic performance. More... 24th March 2014 · 1 min read
US Economics Weekly Yellen wrong to downplay Fed's rate projections We didn't think new Fed Chair Janet Yellen's admission that "considerable period" meant six months or so warranted the subsequent equity sell-off. It simply confirmed what we already knew, that the... 24th March 2014 · 1 min read
Canada Data Response Consumer Prices (Feb.) & Retail Sales (Jan.) The decline in annual headline inflation to 1.1% in February, from 1.5%, won't concern the Bank of Canada as it mainly reflects base-year effects in transportation and clothing. Meanwhile, the strong... 21st March 2014 · 1 min read
US Housing Market Data Response Existing Home Sales (Feb.14) The slight decline in existing home sales in February was the sixth drop in seven months. However, sales of non-distressed existing homes are doing much better. 20th March 2014 · 1 min read
Global Markets Update US rate expectations have further to rise The adverse market reaction to the slightly more hawkish tone of comments from the Fed yesterday looks justified to us. Indeed, market expectations for US interest rates are likely to rise further... 20th March 2014 · 1 min read
US Economics Update Fed sticks to QE taper, drops unemployment threshold As expected, the Fed continued to taper its asset purchases and dropped its explicit unemployment rate threshold, reverting to a more qualitative form of forward guidance in today's policy statement... 19th March 2014 · 1 min read
US Economics Update Weather adds to upside risks to food inflation As a lot of the surge in food prices in February is due to the extreme weather, it is unlikely to be sustained. Nonetheless, the risks to our forecast that food price inflation will climb from 1.4% in... 19th March 2014 · 1 min read
Canada Economics Update Quebec might do better with its own currency Pauline Marois, leader of the separatist Parti Quebecois (PQ), has suggested that an independent Quebec could hold a seat on the governing council of the Bank of Canada and retain the Canadian dollar... 19th March 2014 · 1 min read