Pantheon Macroeconomics

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U.S. Publications

Below is a list of our U.S. Publications for the last 6 months. If you are looking for reports older than 6 months please email info@pantheonmacro.com, or contact your account rep

Please use the filters on the right to search for a specific date or topic.

forecast

16 June 2022 The Fed will Hike Until Inflation is Clearly Falling, and that's too Much

A central bank promising to hike until inflation is clearly falling is effectively promising to overtighten…

…But the healthy state of the private sector’s finances mean that a recession should be averted.

The softness of May retail sales and downward revisions to April will hit Q2 GDP growth forecasts.

Ian Shepherdson (Chief Economist and Founder)U.S.

10 June 2022 Behind the Noise, are Slower Wage Gains Constraining the Core CPI

We expect a 0.5% increase in the core CPI, led by rents, airline fares, and new vehicle prices...

...Behind this noise, though, the core-core CPI might now be slowing on a sequential basis.

The moderation in wage growth probably is reducing inflation pressure in an array of services components.

Ian Shepherdson (Chief Economist and Founder)U.S.

8 June 2022 Net Trade is the Biggest Upside Risk to Q2 GDP Growth

The weakness of the Atlanta Fed’s GDPNow forecast for Q2 is concentrated in the net trade component...

...The model expects imports to remain hugely elevated, but that’s unlikely as inventory-building slows.

The modest downshift in consumer credit growth in April won’t last, given the continued rise in gas prices.

Ian Shepherdson (Chief Economist and Founder)U.S.

29 Apr 2022 Economic Growth will Rebound in Q2, the Fundamentals are Solid

The dip in first quarter GDP hides solid consumption and investment numbers; ignore the noise.

Growth likely will rebound strongly in the second quarter; 5% or better is a decent starting assumption.

A further moderation in ECI wage growth is a good bet for Q1, implying easing core-core inflation risk.

Ian Shepherdson (Chief Economist and Founder)U.S.

22 Mar 2022 Inventories are the Wild Card for Q1 Growth, a Big Drag is Likely

  • A big drag from inventories means we have pulled down our Q1 GDP forecast to zero…
  • …Growth likely will rebound strongly in the second quarter, because final demand looks solid.
  • Chainstore sales growth is slowing rapidly, but mostly—perhaps entirely—due to adverse base effects.

Ian Shepherdson (Chief Economist and Founder)U.S.

17 Mar 2022 The Fed's Intent is Clear, but Risks Abound, in Both Directions

  • The Fed's plan to hike seven times this year is based on inflation forecasts which look too bearish…
  • …But longer-run rate forecasts look too optimistic; perhaps because no one now wants to talk about r*.
  • Retail sales data show consumers not fazed by Omicron; downside risk for February IP data today. 

Ian Shepherdson (Chief Economist and Founder)U.S.

24 Feb 2022 Downside Risks for Spending and the Core PCE Deflator in January

  • Consumption jumped in January, but the increase likely was constrained by weakness in services.
  • Downside risk for the core PCE deflator; look out for a hefty drop in airline fares.
  • Severe weather and Omicron probably depressed January durable goods orders and new home sales.

Ian Shepherdson (Chief Economist and Founder)U.S.

22 Feb 2022 Consumers' Confidence is Low, but that won't Prevent Solid Q1 Spending

  • Consumers' confidence has dipped in recent months but it will rebound, and Q1 spending looks good.
  • Inflation expectations are falling despite big increases in a wide array of infrequently-purchased items.
  • Case-Shiller home price data will reinforce the picture of relentless increases, due to record-low inventory.

Ian Shepherdson (Chief Economist and Founder)U.S.

18 Feb 2022 A Substantial Housing Slowdown is Just a Matter of Time

  • Existing home sales probably fell in January, but this it not the start of the hit from higher rates.
  • The Philly Fed suggests that manufacturing growth is slowing, and supply pressures are easing.
  • The index of leading indicators is set to surprise massively to the downside today, thanks to Omicron.

Ian Shepherdson (Chief Economist and Founder)U.S.

17 Feb 2022 No Decisions Made at the January FOMC, Opinions Appear Split

  • The FOMC is divided on the pace and timing of the coming policy tightening.
  • The huge rebound in January retail sales will lift Q1 growth forecasts, but uncertainty still rules.
  • Housing demand is softening, pushing down the leading components in the NAHB survey.

Ian Shepherdson (Chief Economist and Founder)U.S.

16 Feb 2022 Expect a Big Jump in Headline January Retail Sales; Core is Wild

  • A gratifyingly huge leap in auto sales likely will flatter today's headline January retail sales...
  • The core will be mixed, but we hope falling restaurant sales were offset by gains elsewhere.
  • A weather-driven leap in utility output likely will hide soft January manufacturing data.

Ian Shepherdson (Chief Economist and Founder)U.S.

15 Feb 2022 Russia will Come off Worst in the Long Run if Putin Invades Ukraine

  • The extreme uncertainty over developments in Ukraine make the macro implications unclear.
  • A war would drive up energy prices, but Europe wouldn't freeze, given alternative supply sources.
  • The permanent hit to relations with Russia would drive up spending on defense and energy security.

Ian Shepherdson (Chief Economist and Founder)U.S.

14 Feb 2022 Markets Expect too Much from the Fed in 2022, but not Enough Later

  • Markets are becoming too aggressive on the likely pace of Fed tightening this year...
  • ...But they aren't aggressive enough on the question of the terminal rate, given rising productivity growth.
  • They won't start to talk about rising r-star until much later this year, once the current inflation spike is over.

Ian Shepherdson (Chief Economist and Founder)U.S.

11 Feb 2022 Inflation is Approaching its Peak, but it's not Quite there Yet

  • No break yet in the run of hefty core CPI increases, but vehicle prices are about to start heading south...
  • The new high for the headline rate will increase the political/media pressure on the Fed still further...
  • ...The risk of a 50bp hike in March has increased, but we still think 25bp is more likely.

Ian Shepherdson (Chief Economist and Founder)U.S.

9 Feb 2022 Mortgage Demand is Starting to Soften in the Face of Higher Rates

  • Higher mortgage rates are starting to depress demand; home sales will fall through mid-year, at least.
  • Falling demand and rising inventory will slow price gains and, eventually, dampen rent pressures.
  • The NFIB survey hints that the labor market might be easing a bit, at the margin.

Ian Shepherdson (Chief Economist and Founder)U.S.

4 Feb 2022 Omicron Noise Looks Set to Swamp the January Payroll Signal

  • The signal from January payrolls is likely to be drowned out by the noise; February too?
  • Participation and the unemployment rate are wild cards too, but the risk to wages is to the upside.
  • Productivity growth appears to have stabilized at about 2%; that's OK, but we expect better ahead.

Ian Shepherdson (Chief Economist and Founder)U.S.

3 Feb 2022 Productivity Noise is Drowning the Signal, but the Outlook is Good

  • Productivity growth rebounded in Q4, but the more important point is that the outlook is very bright...
  • ...Stronger productivity growth over the medium-term would boost real incomes and corporate earnings.
  • The Omicron hit means downside risk to today's ISM services index; expect better in February.

Ian Shepherdson (Chief Economist and Founder)U.S.

1 Feb 2022 A Hit to the ISM from Omicron, but not a Knockout Blow

  • The ISM index likely dipped in January, but a big Omicron hit seems to have been averted.
  • The construction recovery has been driven entirely by housing, but the story is changing…
  • …Industrial and commercial construction is rebounding strongly, but housing activity is set to drop.

Ian Shepherdson (Chief Economist and Founder)U.S.

28 Jan 2022 The Omicron Hit is Set to Limit the Fed's Freedom to Act in March

  • We expect zero GDP growth in the first quarter, thanks to Omicron, but inflation will hit new highs.
  • The Fed will hike, but 50bp would be a big stretch after back-to-back declines in payrolls.
  • By the time growth rebounds in the second quarter, inflation will be falling sharply.

Ian Shepherdson (Chief Economist and Founder)U.S.

27 Jan 2022 A March Hike but no Balance Sheet Decisions yet, all Options Open

  • Rates will rise in March, but Powell suggests no bal- ance sheet run-off announcement until May...
  • ...Even May is not certain, given the likelihood of a run of very weak activity data between now and then.
  • Q4 GDP growth enjoyed a last-minute boost from surging December inventories, upside risk today.

Ian Shepherdson (Chief Economist and Founder)U.S.

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