Commodities Update What would “Operation Twist” mean for commodities? Any further easing from the US Fed will probably be limited to lengthening the maturity of its existing holdings of Treasury securities (“Operation Twist”) rather than a third round of outright... 15th September 2011 · 1 min read
US Housing Market Chart Pack Cash buyers and investors take fright Even though mortgage rates have fallen to record lows and housing has become more undervalued relative to incomes than ever before, the number of home sales has continued to decline. More striking is... 15th September 2011 · 1 min read
US Fed Watch Operation Twist offers best hope among limited options Given the weakness of the incoming economic data, the Fed is now almost certain to do something at next week's FOMC meeting, but exactly what is still not entirely clear. The proposal to lengthen the... 15th September 2011 · 1 min read
US Data Response Retail Sales & Producer Prices (Aug.) The stagnation in retail sales in August suggests that households became more cautious after the plunge in equity prices towards the start of the month. Sales may also have been dampened by Hurricane... 15th September 2011 · 1 min read
US Economic Outlook Recovery going from bad to worse Recent developments have only reinforced our long-held belief that the economic recovery will remain unusually lacklustre for several more years. We now expect GDP growth of just 1.5% in 2012 and 2.0%... 14th September 2011 · 1 min read
Canada Chart Pack Is the squeeze on real household income over? Real personal disposable income growth slowed to a snail pace during the first half of this year, depressing consumer spending in the process. Compared to a year ago, second-quarter real income... 13th September 2011 · 1 min read
Canada Economics Weekly Tightening financial conditions cast more doubt Judging by the declines in the Bank of Canada's Financial Conditions Index (FCI), financial conditions appear to have tightened recently, despite somewhat lower bond yields. Although the amount of... 13th September 2011 · 1 min read
US Economics Weekly Policymakers lay out the case for more action Policymakers were back in the spotlight last week, with hopes growing that we could now see further monetary and fiscal stimulus. Unfortunately, we doubt that the Fed will have much success with what... 13th September 2011 · 1 min read
Canada Data Response Labour Force Survey (Aug.) The drop in August employment was disappointing and points to modest growth in household spending this quarter. The only redeeming quality in the jobs report was the rotation from part-time to full... 10th September 2011 · 1 min read
US Economics Update American Jobs Act is big but politically polarising President Obama's newly proposed $450bn job creation bill is equivalent to nearly 3% of GDP, so if it was passed by Congress as it stands it would certainly have a significant impact on GDP growth in... 10th September 2011 · 1 min read
Canada Data Response International Merchandise Trade (Jul.) July's international trade data provides further evidence that the economy rebounded from the disappointing second-quarter contraction, growing by an estimated 2.5% annualised this quarter. Whether or... 9th September 2011 · 1 min read
US Data Response International Trade (Jul.) The sharp decline in the trade deficit in July is one more reason to believe that annualised third-quarter GDP growth will come in around 2.5%. With global demand clearly weakening, however, the... 9th September 2011 · 1 min read
Canada Economics Update The disappearing case for rate increases Considering the contraction in second-quarter GDP and evidence of slowing global economic growth and rising financial risks, it is not a surprise to anyone that the Bank of Canada kept its policy... 8th September 2011 · 1 min read
US Housing Market Data Response Mortgage Applications (Aug.) The latest mortgage applications figures illustrate how ultra-loose monetary policy is failing to boost economic activity. Despite the fall in 30-year mortgage rates to within a whisker of a record... 8th September 2011 · 1 min read
US Housing Market Update FHFA's new house price index still falls short The FHFA's new "expanded-data" house price index is better than its other indices as it includes some purchases made with cash and non-conforming loans. However, as it is still a less comprehensive... 7th September 2011 · 1 min read
Canada Economics Weekly What's all the fuss about real GDI? Most analysts agree that real Gross Domestic Income (GDI) is another useful indication of economic activity. For the purposes of monetary policy, however, what ultimately matters, more than any other... 6th September 2011 · 1 min read
