From Torsten Slok’s “Recession Watch” chartpack today:
Glick, Leduc, Pepper: “Will Workers Demand Cost-of-Living Adjustments?”
That’s the title of a recent SF Fed Economic Letter, by Reuven Glick, Sylvain Leduc, and Mollie Pepper.
Households are currently expecting inflation to run high in the short run but to remain muted over the more distant future. Given this divergence, what role do short-run and long-run household inflation expectations play in determining what workers expect for future wages? Data show that wage inflation is sensitive to movements in household short-run inflation expectations but not to those over longer horizons. This points to an upside risk for inflation, as workers negotiate higher wages that businesses could pass on to consumers by raising prices.
So You Think We’re In a Recession as of Mid-August?
Weekly and daily readings through 8/13:
Retail Sales, Inflation Adjusted
Beating consensus for July.
Looking Back at Q2 – Imminent Upward Revisions?
IHS Markit moves 2022Q2 tracking from -0.3% to -0.2% SAAR today. Goldman Sachs moves from the advance official of -0.9% to -0.4% SAAR. Continue reading
Business Cycle Indicators as of Mid-August 2022
Industrial production and manufacturing production exceeded consensus (0.6% vs. 0.3%, 0.7% vs. 0.2%, respectively) yielding the following graph of key indicators.
So You Think We’re In a Recession as of Beginning August (Part II)
Follow up to “So you think we’re in a recession as of beginning August”…and rejoinder to those who believe we’ve already been in recession for a while.
US and Euro Area Headline Inflation Compared
Using flash estimates for Euro Area HICP. US inflation m/m , q/q falling:
One Year Ahead Expected Inflation
Firm expectations nudge up, but household/consumer expectations are down. Survey of Professional Forecasters forecasts as of early July, out on Friday.
So You Think We’re In a Recession as of Beginning August
We’re roughly a month into Q3. Here’s a view, written a week ago:
…based on the indicators I track, yes, I think we are in continuing recession, and I expect a hard reset of the economy in H2.