The Economic Insights Channel

Problems Solved?

Brexit and trade talks provided lots of uncertainty this year. Last week saw progress on both fronts.

Expecting a Market Downturn? Make Sure You’re Following the “Noah Rule”

Predicting a major economic or financial event—whether that’s a recession, market downturn or even your own retirement—requires that you also take action. Otherwise your prediction was meaningless.

Time to Do the Hard Thing

Much of the reaction to last week’s Inflationary Angst letter boiled down to, “Get government out of the way and the free market will work.” Others said the opposite: Government must help people even more than it already does. I wish it were that easy. Neither of those options are what we need, and today I will explain why.

S&P 500 Snapshot: Another High

The index reached another new high today, closing at 3168.80. It is mostly unchanged from Thursday, up 0.73% from last Friday, and is up 26.41% YTD.

Underlying Inflation Gauge: November Update

The latest full set UIG for November is 2.35% while the prices-only measure is 2.10%. Current Headline CPI is now 2.05% and Core CPI is 2.32%.

UK Election: Will Tory Victory Bring Investors Back to UK Equities?

As widely expected, the Conservative Party emerged victorious in the UK general election. Our Colin Morton anticipates UK equity markets will welcome the outcome, but cautions that some uncertainties remain.

What Boris Johnson’s Election Victory Means for UK Assets

We expect to see flows back into UK equity and credit now that some of the Brexit uncertainty has been removed.

Federal Reserve Appears Confident in U.S. Economy's Soft Landing

In its December forecasts, the Federal Reserve estimates that the policy rate will hold steady through 2020. Will economic and trade developments change that view?

The Big Four Economic Indicators: November Real Retail Sales

Month-over-month nominal sales in November increased by 0.2% (0.19% to two decimal points). Real Retail Sales, calculated with the seasonally adjusted Consumer Price Index, decreased by 0.1% (0.07% to two decimal points).

ECRI Weekly Leading Index Update

This morning's release of the publicly available data from ECRI puts its Weekly Leading Index (WLI) at 145.9, down 1.9 from the previous week. Year-over-year the four-week moving average of the indicator is now at 1.23%, down from last week. The WLI Growth indicator is now at 2.23, also down from the previous week.

Household Incomes: The Value of Higher Education

What is the value of education for household income? The Census Bureau's annual survey data for 2018 published in September gives us some interesting insights into this question. The median income for all households with a householder age 25 and older was $64,761. The chart below shows the median annual household income for nine cohorts by educational attainment. We've rounded the data points to the nearest $100, e.g. $64.8K for all households age 25 and older.

Fed Holds Rates Steady, as Expected

The Federal Reserve left interest rates unchanged, as expected; while signaling rates would stay in their current range through next year.

The 2020 Economic Outlook

U.S. economic activity is expected to remain mixed in 2020, with moderate strength in consumer spending and general softness in business fixed investment and manufacturing.

Closing Strong

The Northern Trust Economics team shares its outlook for U.S. economic growth, inflation, unemployment and interest rates.

Fed on Hold

No one expected the Federal Reserve to change short-term rates today and no change was made. Meanwhile, the Fed made no significant changes to its policy statement and the statement was unanimous.