13 May 2022 The Dip in April PPI Margins is a Hint of Better Inflation News Ahead

Retail and wholesale profit margins fell in April, in a sign of better inflation news ahead.

Progress will be uneven, but the ongoing inventory rebuild should push margins down over the next year.

Jobless claims seem to have stabilized at about 200K per week; nothing to worry about.

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

31 Mar 2022 Everything Except ADP Points to a Soft March Payroll Report

• We're sticking to our zero payroll forecast; Homebase and other data contradict ADP.
• A rebound in February spending on services seems to have been offset by a drop in spending on goods. 
• Core PCE inflation likely rose, but the February reading could be the peak; Q2 will see a clear downshift.

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.