Tag Archives: China

Trade Deficit Widens as Emerging Economies Sputter

The trade deficit widened in August to $48.3 billion, up from a revised $41.8 billion in July, in a further sign that weakness abroad is creating headwinds for the American domestic economy. Exports declined by 2%,

FOMC Hedges Downside Risks

The Federal Open Market Committee (FOMC) delayed liftoff today in response to concerns about growth abroad (read: China) and the likelihood that inflation will move lower before it moves higher. The central tendency of members in the meeting revealed their actual concerns (which provide the rationale for their decisions) that growth and inflation could both [...]

Market Gremlins Disrupt Liftoff

Rapid declines in global equity prices, risks that the downdraft in China will take the U.S. market down again tomorrow and a legitimate concern that inflation will further decelerate are now expected to keep the Federal Reserve on the sidelines in September. A move in December is still possible, but a close call. Uber dove [...]

Yuan Devaluation: Nod to Markets or Currency Manipulation?

Last week the Chinese central bank, the People’s Bank of China (PBOC), announced a change in its exchange rate-setting mechanism that resulted in a de facto devaluation of the yuan, which dropped by more than 4% by the end of the week. The decision was widely interpreted as a deliberate attempt to weaken the currency, [...]

Fed Holds Cards Close to Vest

The Federal Open Market Committee (FOMC) minutes show that the Federal Reserve continued to edge toward liftoff, but members were not there yet last month. The divide between those on the FOMC who would like to raise rates in September and those who would prefer to wait is widening.

Trade Deficit Narrows

The trade deficit narrowed more than expected in April to a negative $40.9 billion from a negative $50.6 billion in March (after some revisions). Both exports and imports contributed to the more favorable outcome.

Five Themes for the Week

Economic Struggles in China and Greece Chinese authorities sprang into action just a few days after announcing a disappointing first quarter GDP growth rate. The People’s Bank of China (PBOC) last night reduced the banks’ reserve requirement by 1% to 18.5% with the intended goal of free, loanable funds in the banking system in order [...]

China Barely Meets Diminished Expectations

The latest report on Chinese GDP raises new concerns about the economic health of the country. The economy grew 7% in the first quarter; conveniently, that is the growth target set by the Chinese authorities for 2015. Unfortunately, it is also the slowest pace since 2009

Consumers Better but Durable Goods not So Good

Durable goods orders finally bounced back in October and rose 0.4% from September after two months of declines. Moreover, September losses are now smaller than initially reported. Gains were concentrated in defense aircraft and parts, reflecting the need to ramp up to deal with escalating tensions in the Middle East including the bombing of ISIS. [...]

Trade Deficit Widens

The trade deficit widened from $40 billion in August to $43 billion in September. Imports were essentially unchanged while exports declined slightly. Exports of industrial materials and supplies, which include telecommunications equipment and capital goods, were particularly weak.