US Economic Chartbooks
Please see our Economic Week Ahead Chartbook for a discussion of next week's economic releases provided in a visually friendly format that includes graphs, brief descriptions of SMR's forecasts, and links to detailed data previews. If you missed anything from last week, see our Economic Week in Review Chartbook for a look back at the releases with links to full analyses.
Empty Noise on Today's Board of Governors Meeting
We have been hearing a lot of empty noise in the press about today's closed meeting of the Board of Governors to discuss the discount rate at 11:30 ET. The advance notice under "expedited procedures" is in fact the normal way in which all such meetings are announced, as even the most cursory glance at the Fed's announcement page for Board meetings shows. It simply reflects that the Board is announcing it only a few days before the meeting. The Board of Governors typically meets the Monday before an FOMC meeting and also the Monday two weeks before that. In this instance, the Board is opting to do so three weeks in advance, probably because of the holiday timing. This is not unusual.
Oct. 27-28 FOMC Meeting Minutes - A Prudent Committee Reviewed its Options
The minutes of the October 27-28 FOMC meeting affirms what we have heard from Fed policymakers in the intermeeting period. A majority of the Committee either find conditions appropriate for a small hike in the fed funds rate, or expect to by the December 15-16 meeting.
Why Isn't The Economy Creating More Jobs? The Answer May Be in BED
In this note we take a look at the most recent (Q1-2015) Business Employment Dynamics (BED) data to garner a better understanding of the dynamics underlying the behavior of private sector payrolls.
Our findings include the following:
(1) The behavior of payrolls at existing firms was unusually strong in Q4-2014, followed by unusual weakness in Q1-2015.
(2) The big swing in the momentum of payroll gains from Q4-2014 to Q1-2015 was primary amongst large firms with more than 1,000 employees.
(3) What is still lagging, albeit improving, is the employment gains of new firms or births of businesses. Here we suspect the availability of credit remains a constraining factor.
TIC Focus: Foreigners Buy $4.6 Bln Agencies, $15.1 Bln Corps in September
--The TIC transactions data showed that foreign investors bought $4.6 billion of agency debt and MBS in September. Most of the purchases were of MBS.
--Investors in Japan were the largest buyers of agencies in September; investors in the Caymans were the biggest sellers.
--Holdings data for August show China cutting its agency/MBS holdings by $12.7 billion. That's consistent with what we saw in custody account data.
--Foreign investors were buyers of $15.1 billion of corporate bonds in September, with most of the buying originating, as usual, out of the U.K.