The nation’s business economists have sharply raised their forecasts for inflation, predicting an extension of the price spikes that have resulted in large part from bottlenecked supply chains.
Overall, the November jobs figures point to a job market and an economic recovery that look resilient though under threat from a spike in inflation, shortages of workers and supplies and the potential impact of the omicron variant of the coronavirus.
The four-week average of claims, which smooths out week-to-week ups and downs, fell below 239,000, a pandemic low.
General Motors raised its outlook Wednesday and said it expects to return to a normal production rate by the end of next year.
In a survey of business conditions, the Fed’s 12 regional banks found that the economy continued to grow at a modest-to-moderate pace. But because of supply chain problems, price increases were reported to be widespread across the economy.
Even before the omicron variant appeared, consumer optimism was being tested by price spikes across the board, particularly for gasoline and food.
Gina Raimondo will press Congress to pass legislation that would put about $52 billion toward U.S. chip manufacturing in a speech to the Economic Club of Detroit during a visit to the city that’s the capital of American auto manufacturing.
U.S. consumer spending rebounded in October, rising by a a solid 1.3% despite rising inflation that over the past year has reached the fastest pace in more than three decades.
The expectation is that the economy in the current October-December quarter could grow at the strongest pace this year, with some economists forecast GDP could surge to an 8% rate in the fourth quarter.
The economic principle of revealed preference comes into play: what people do reveals their preferences. In the family’s own estimation, they are better off!
As any American who has bought a carton of milk, a gallon of gas or a used car could tell you, inflation has settled in. And economists are now voicing a more discouraging message.
Fifth Third Bank’s Chief Investment Strategist Jeff Korzenik told an Indianapolis audience Wednesday that the workforce crunch and sudden glut in downtown office space remain vexing problems, but Indiana is in solid position to take advantage of the return of manufacturing from overseas.
Applications for unemployment aid have been falling mostly steadily since topping 900,000 in early January and are gradually nearing prepandemic levels of around 220,000 a week.
Inflation is eroding the strong gains in wages and salaries that have flowed to America’s workers in recent months, creating political headaches for the Biden administration and congressional Democrats and intensifying pressure on the Federal Reserve.
The Labor Department reported Tuesday that its producer price index—which measures inflation before it hits consumers—rose 0.6% last month from September, pushed higher by surging gasoline prices.
Friday’s report from the Labor Department also showed that the unemployment rate fell to 4.6% last month, from 4.8% in September.
After two disappointing months of hiring, a key question overhanging Friday’s U.S. jobs report for October will be whether companies found more success this time in filling millions of open positions.
Overall, 2.1 million Americans were collecting unemployment checks the week of Oct. 23—down from 7.1 million a year earlier when the economy was still reeling from the coronavirus outbreak.
Federal Reserve Chair Jerome Powell said the Fed was sticking by its bedrock economic forecast. Yet, the nation’s leading economic figure acknowledged that it isn’t at all clear when or even whether things will play out the way he and other Fed officials hope.
The Fed’s likely decision this week to taper its bond purchases comes as high inflation is bedeviling the U.S. economy for much longer than Federal Reserve Chair Powell and many other officials initially expected.
