Daily update
Daily update
- Yesterday’s US consumer price data was less weird—no 4% monthly increases in rent in Detroit (as in March). The detail showed for almost every business sector, there is deflation somewhere in the United States. For the benefit of non-economists (like the Chair of the Federal Reserve) this is not remotely consistent with sticky prices.
- The US retail sales data highlighted some of the structural shifts of the US economy. The bias to spending on things that are fun is more or less in evidence, and deflation in durable goods prices is weighing on the value of sales in that sector. The ongoing rise of online retail is evident—with wider implications for productivity, real estate use, and transport.
- Japan’s first quarter GDP fell more than expected, with some negative revisions to the previous quarter. Consumers are spending less as real incomes continue to suffer. GDP is not a great indicator for a country with a declining population, and the strength of the tourism sector is a potential offset to domestic demand weakness.
- US initial jobless claims data may get some attention. US import and export prices are very much a second tier release, but might be more relevant as President Biden increases US consumers’ tax burden via tariffs.
