Markets: Coming off the holiday Markets retreated last week, dropping a lot in the final hour of trading on Friday.
The S&P roller coaster last week: Holiday, down, down a touch, down, down a touch, and down a lot.
Beige Book: Economic activity, from July through August, slowed a bit nationally to a moderate pace. For the Cleveland District, while slower than the last report, still showed solid growth. Supply constraints limited the ability to keep up with demand. Rising non-labor prices were widespread. Consumer spending went up a touch. And housing demand remains really strong.
Inflation: The Wholesale inflation number (the PPI) was updated last Friday morning. Coming off a 7.8% July number, the August number came in as expected at 8.3%. The PPI started the year at 0.8%. The Fed has been saying for months that the inflation we’ve been experiencing is just “transitory”. Maybe their definition of transitory inflation is different than mine. For me it would mean up and then down… not a consistent increase.
Jobless claims: The weekly number came in at 310,000. I believe that’s the best number since the pandemic arrived.
Radio: Bill was off last Friday. You can normally hear us most Fridays at 6:38a, 7:38a, and 8:38a on 1100AM.
Focus of the week: Will inflation continue to rise? The wholesale number went up a touch last week. We’ll get the consumer inflation update on Tuesday. The consensus is that it will drop a tick from 5.4% down to 5.3%. Markets were a bit jittery last Friday from the wholesale result. We’ll see how they respond to the wholesale number.
Indicator focus: The CPI (Tue); retail sales, and jobless claims (Thu).