23 July 2025 US Monitor Further fall in housing inflation will give the Fed some breathing room

• Housing inflation will fall much further over the rest of this year, lagging the real-time rent data…
• …Lower housing inflation will offset about a quarter of the remaining uplift from tariff pass-through.
• It's in no one's interest for the administration to seek to oust Fed Chair Powell.

22 July 2025 US Monitor State-level payrolls cast further doubt on a migrant exodus

• BLS data suggesting the foreign-born workforce is already rapidly shrinking look implausible.
• Sector-level payrolls in California and Texas suggest most undocumented workers remain in their jobs.
• A bird’s eye view of employment growth in the other 48 states and DC tells a similar story.

July 2025 - US Economic Chartbook

CONSUMERS’ SPENDING IS SLOWING...

• ...WEAKER PAYROLLS IN Q3 WILL EXERT FURTHER PRESSURE

PM Datanote: US Housing Starts, June

The underlying trend in residential construction is flat and likely to turn lower.

PM Datanote: US Michigan Sentiment Survey, July

Hard to trust given the rock-bottom response rate.

PM Datanote: US Weekly Jobless Claims, July 12

Low simply because auto plant shutdowns have been less prevalent than usual.

PM Datanote: US Retail Sales, June

Sales growth less impressive in real terms; consumer slowdown continues.

21 July 2025 US Monitor Will the unwinding of June's jump in education jobs depress Q3 payrolls?

• The jump in June education jobs is more likely to be revised away than to unwind over coming months.
• June education jobs were revised down in 2022, 2023 and 2024; no other data corroborate the 2025 jump.
• A structural break following a mid-2024 methodology change makes the Michigan survey hard to believe.

18 July 2025 US Monitor Clearer signs of tariff-induced weakness in June retail sales volumes

• The modest gains in nominal retail sales in June were boosted by price rises; sales volumes were stagnant.
• Real consumption likely rose by just 1½% in Q2 and is on track for even slower growth in Q3.   
• The cost of new tariffs has so far been borne entirely by US importers, rather than foreign exporters. 

PM Datanote: US PPI, June

Services disinflation is partly countering the tariff uplift to goods prices.

17 July 2025 US Monitor PPI data show tariffs are inflationary, but only for goods

• PPI and CPI data collectively point to a 0.28% increase in the June core PCE deflator; tariffs mostly to blame.
• The core PPI was unchanged partly due to a plunge in prices charged for accommodation, which are volatile.
• Announcing a shadow fed Chair is a bigger risk than removing Mr. Powell immediately from his post.

16 July 2025 US Monitor Tariff-related price hikes hit in June, with worse to come in July

The June rise in core goods prices, ex-autos, was the biggest in three years; import-sensitive prices leapt...

...But only a quarter of the tariff costs has come through so far; expect even bigger price rises in July.

CPI services inflation will continue to cool, but it will offset only about half the pick-up in goods inflation.  

PM Datanote: US CPI, June

A knock-out punch to the tariff inflation deniers.

15 July 2025 US Monitor Retail slowdown likely continued in June, as headline sales flat-lined

• We think headline retail sales were little changed in June, after falling in April and May.
• A small price-driven increase in control sales was likely mostly offset by another fall in auto sales.
• Homebase are roughly consistent with 150K for July private payrolls, but we prefer to trust other indicators.

14 July 2025 US Monitor Income tax clarity won't reinvigorate households' spending in Q3

• The slowdown in consumption this year has been sharpest in areas dominated by higher earners...
• ...Slower asset price gains and expected real wage declines have weighed more than tax hike risk.
• Mortgage applications have risen sharply; people are fed up waiting for mortgage rates to fall.

PM Datanote: US FOMC Minutes, June 18 Meeting

Committee is more clearly split; weaker labor market to tip the balance by September.

11 July 2025 US Monitor Immigration probably will continue to add meaningfully to labor supply

• President Trump’s policies will slow the flow of immigration into the US, but not halt it entirely.
• The idea that a big migrant exodus from the labor market is already underway is at odds with the data.
• We continue to think labor demand will grow more slowly than supply, lifting the unemployment rate.

PM Datanote: US NFIB Small Business Optimism Survey, June

Plunging response rate raises big questions about reliability.

10 July 2025 US Monitor The tariff boost to consumer prices will be undeniable in June's data

• Adobe's Digital Price Index suggests some goods prices rose in June at the fastest pace since 2023.
• Primary rent probably rose at an above-trend pace in June, while airline fares likely stopped falling.
• Residual seasonality continues to blight the services price data; expect a bigger rise in June than in May. 

9 July 2025 US Monitor Only higher reciprocal tariffs on the EU would tangibly lift US inflation

• Exemptions and sector-specific tariffs cover most imports from Japan, leaving the “reciprocal” rate irrelevant.
• Raising the reciprocal rate of EU imports to 50% would boost the US CPI by nearly 1/2%, but a deal is likely.
• The NY Fed survey continues to paint a far more upbeat picture than the other major consumer surveys.