May 9, 2023
At its May 2023 meeting, the Federal Reserve’s FOMC announced it was raising the Fed Funds Rate by 25 bps to a range between 5.00% and 5.25%. This was widely expected to be the last in a series of rate hikes that began in March 2022. The Fed’s statement can be found here. This chart offers […]
May 9, 2023
This post summarizes a Twitter thread I posted on May 7, 2023. 1. A short Q&A about the debt limit. First of all, where did it come from? 2. Article I, Section 8 of the Constitution assigns Congress the power to incur debt. Prior to World War I, it directly authorized each issuance of government […]
May 7, 2023
US real GDP in 1Q23 grew at an annualized rate of +1.1% q/q, slower than the 2.0% expected. This was down from +2.6% in 4Q22. The composition of real GDP growth in 1Q23 was: +1.1% = +2.5 consumption, +0.1 business investment, -2.3 inventories, -0.2 housing, +0.8 government spending, +0.1 net exports. In contrast, the (revised) […]
May 5, 2023
The US federal budget deficit for the calendar year 2022 was $1.42 trillion, down significantly from $3.35 trillion in 2021. The US federal budget deficit as a percentage of GDP declined back to 5.4% in 2022, down from 11.9% in 2021 and 14.9% (which was the highest figure since World War II). The Congressional Budget […]
May 5, 2023
The US economy added +253,000 jobs in April, beating expectations of a +180,000 gain. However, previous months were revised downwards by -78k in February and -71k in March, for a total of -149k. As a result, average job gains over the past three months were +222k per month, down from an average rate of +399k […]
May 4, 2023
The U.S. trade deficit in goods and services declined to $64.2 billion in March, after reaching an all-time high in March 2020. The trade deficit for Q1 was $203.5 billion, -27.6% smaller than a year ago. In 2021, the annual U.S. trade deficit hit a new record at $845.0 billion. Higher tariff policies under the […]
May 3, 2023
U.S. factory orders rose +0.9% m/m in March, up just 1.4% from a year ago. Keep in mind these numbers are not adjusted for inflation, and the PCE price index was up +4.2% y/y in March, which suggests a real contraction. For Q1 as a whole, order fell -2.1% q/q, up just +2.5% from a […]
May 3, 2023
The following are diffusion indices, based on business surveys, which means that >50 indicates expansion and <50 indicates contraction, and 50 indicates no change. A larger or small number indicates breadth, not intensity, among survey respondents. ISM Manufacturing Index rebounded +0.8 points in April to 47.1, but remained in its 6th straight month of contraction. […]
April 30, 2023
The University of Michigan’s US Consumer Sentiment gauge rose +2.4% in April to 63.5, though that is still down -2.6% from a year ago, and well below pre-Covid levels. The Conference Board’s US Consumer Confidence index fell -2.7 points in April to 101.3, “below the level which often signals a recession looming in the short-term,” […]
April 30, 2023
U.S. new homes sales rose +9.6% m/m in March, but were still down -3.4% from a year ago. For Q1 as a whole, sales rose +9.0% q/q, down -16.1% from a year before. US existing home sales fell -2.4% m/m in March, down -22.0% from a year ago. The median sales price of new homes […]