Trading into consumer demand

Daily update

China’s July export data was somewhat stronger than expected. The big three electrification exports have collectively been important to export growth. China’s exports to the US are steady around pre-pandemic levels (using China’s data, which is probably a better reflection of trade trends). German June exports were stronger than expected and (of course) past data was revised stronger.
The US employment report remains an imprecise snapshot of the labor market. Firms simply do not tell the Bureau of Labour Statistics about their payroll numbers, and the structural change complicates modern employment data. The narrative of a no-hire, no-fire labor market gives US consumers the confidence to reduce savings rates in order to spend (per China export data) but does not give the confidence to demand higher wages.
The market’s main concern is less the data, more how the Federal Reserve reacts to that. Media reports are now citing people familiar with Fed Chair Warsh’s thinking—presumably an attempt to communicate with the real world without seeming to reverse the recent communication policy. The impression is that Warsh is happy on hold.
The oil price has moved higher again. There is no point asking economists to analyze this as it will no doubt move back down again soon.