Weekly data and Google/big data through July 16th, on the US economy (follow up on Part I, Part II, Part III, Part IV, Part V, as well as “So you think we might be in recession as of mid-June”, Part I and Part II).
Guest Contribution: “The US Q2 GDP Announcement Will Not Mean Recession”
Today, we present a guest post written by Jeffrey Frankel, Harpel Professor at Harvard’s Kennedy School of Government, and formerly a member of the White House Council of Economic Advisers. A shorter version appeared at Project Syndicate.
Inflation, Gasoline, Recession
I was on WPR’s Central Time today, discussing among other things: “Gas and oil prices are starting to come back down. We explore what that means for inflation and fears of a recession.”
Term Spreads Falling
And negative at the 2s10s:
One Year CPI Inflation Expectations as of Mid-July
NY Fed consumer expectations up in June, Michigan down in July. WSJ July survey mean says y/y inflation will be 3.9% in June 2023.
Inflation in June
A little bit of old news, but it seems useful to see what various indicators show, month-on-month annualized. Chained, trimmed and sticky price inflation are all lower than headline:
A Depressed Growth Trajectory: The Wall Street Journal July Survey
Forecasters are downbeat relative April survey (Figure 1). And about a third forecast negative Q/Q growth in 2022Q2, but the mean (and median) forecast is for positive growth, as shown in Figure 2 (though there being two consecutive quarters of negative growth are not central to determining whether NBER BCDC declares a recession). About a fifth of respondents predict at least two consecutive quarters of negative growth starting later in 2022-23.
Battery Storage Costs for Utilities
(Or…, are renewables useless because of peak load issues?) From IPCC AR6 Working Group 3 report (page 6-24):
China Q2 Takes an (Expected) Dive
A 2.6% q/q dive in Chinese GDP is unsurprising, but unwelcome nonetheless:
Another Quarter of Negative Growth?
The Atlanta Fed’s nowcast for Q2 as of 7/15 was for -1.5% Q/Q SAAR. What does this tell us about what is likely to be the advance print, and then subsequent releases.