Tag Archives: federal reserve

Inflation Increases at the Gas Pump

The Consumer Price Index (CPI) rose 0.3% in June, after rising 0.4% in May. Almost all of the increase (2/3) was driven by a sharp (3.3%) jump in prices at the gas pump. Food prices decelerated in June, after increases in previous months; prices at the grocery store were flat after some increase in recent [...]

Yellen Defends Gradualism

Federal Reserve Chair Janet Yellen has been succinct in her testimony to the Senate Banking Committee today. She emphasized that weakness in the first quarter was likely transitory, but still worse than anyone expected.  The Fed needs to be mindful on how much it can write off to weather problems. She also cited ongoing problems [...]

Employment Explodes for July 4th Holiday

Payroll employment jumped by 288,000 in the month of June, with upward revisions to both May and April. April now shows a rise of more than 300,000 as the economy continued to snap back from the winter doldrums.

Yellen Provides Road Map to Fight Bubbles

Federal Reserve Chair Janet Yellen shot a warning across the bow of financial markets today by laying out just how aggressive the Fed is willing to get in order to stem potential bubbles. She stressed the use of macroprudential, or regulatory policies, over direct changes in monetary policy to ensure financial market stability but did [...]

Fed Stays the Course but Shows Divisions on Exit Strategy

As expected, the FOMC voted to stay the course and continue its gradual tapering of asset purchases today, with a reduction of $5 billion in purchases of mortgage-backed securities to $15 billion per month and a $5 billion in Treasury bond purchases to $20 billion in July. The Fed marked down its forecast for the [...]

Inflation up, Housing down

The Consumer Price Index (CPI) rose 0.4% in May, the largest increase since early 2013. The rise in food prices on the heels of a harsh winter, disruptions to the planting season and drought in the West pushed up the price of food at home by 0.7%, which was no surprise to anyone shopping at [...]

Manufacturing still a Bright Spot

Industrial production rebounded 0.6% in May, after slipping a smaller-than-initially reported 0.3% in April. Gains were driven by a pickup in the production of vehicles and other durables, including business equipment. That supports our view that spending on big ticket items such as vehicles, furniture, appliances and investment in new equipment will drive growth as [...]

Two Steps Forward, One Back on Employment

Nonfarm payroll employment rose 217,000 in May, crossing the total level of employment hit prior to the crisis in early 2008. Government payrolls were up by 1,000, a modest but major shift from the drag we saw  government spending cuts place on the payrolls data during much of the recovery.  A gain in local government [...]

GDP Drop Expected to Reverse in Q2

Real GDP was revised down to show a 1% decline in the first quarter. Most of that drop was due to a larger-than-expected liquidation in inventories, which is good in that it leaves more room for a rebound in the second quarter. Manufacturing activity has already picked up on the heels of better weather.

Home Sales Remain Sluggish

Existing home sales barely budged between March and April, despite still record-low rates and high affordability. Sales are still down almost 7% from a year ago and even more from the peak we saw last summer. Everything from a dearth of first-time buyers who are either still un- or underemployed with a debilitating overhang of [...]