Welcome
This is the Monthly Macro Report, a ~5 minute overview of major US macroeconomic data. This is meant for both a retail and professional audience who are looking for a quick and easy reference for significant economic data.
The data included in this report covers the following areas: Employment, mortgage rates and housing market activity, price indices, Fed balance sheet and money supply.
For each metric, we include a graph of the trailing 10 years of data, performance of the metric year-over-year (YoY) and a percentile reading, which indicates the severity of the metric’s YoY performance relative to the metric’s historical data.
We are open to including other metrics upon request. Feel free to reach out with suggestions. Please subscribe if you find this useful.
Commentary
High-level employment metrics continue to be strong, but not only are there early signs that employers are starting to slow down the pace of hiring but these lagging metrics are starting to tick up off the bottom.
Anecdotally, we are getting daily news stories of companies pausing hiring or beginning layoffs. Facebook/Meta is the big news story this week. It is rumored that they will be laying off thousands of employees possibly as early as Wednesday. Many other tech companies that have seen their valuations halved (or more) in short order have started to react similarly.
We are now seeing the initial claims data start to tick up higher week over week. For the week ended 10/22, initial claims rose 3.3% week-over-week, which was a 96%ile reading and was the second 90+%ile reading in the last month. This particular economic metric can surprise higher very quickly, so keep your eyes on claims in the near future.
As we have noted in the last several Monthly Macro pieces, the Consumer Sentiment survey remains devastatingly bearish. Consumer sentiment is now in its worst and swiftest drawdown of all time. The American consumer is hurting very badly now, as evidenced by revolving consumer credit usage (people are relying on credit cards to consume).
Mortgage rates have increased at their fastest pace on record since the end of 2021. This has lead to housing starts slowing and months of supply skyrocket. The housing market is sending the same signal as the Consumer Sentiment survey - The American consumer is tapped out and increasingly pinched. Expect to see prices down significantly with mortgage rates up so much.
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