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Wall Street picks hope over reality after inflation report
The US economy has some ways to go to tame inflation, Federal Reserve Chairman Jerome Powell has said. “If we continue to get… strong labour market reports or high inflation reports, it may well be the case that we’ve to do more and raise rates more,” he added. This comes after weaker-than-expected retail sales in…
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Rates fall for the fourth week in a row
Mortgage application activity sunk to a quarter-century low this week as high mortgageRates continue to weaken the housing market, Sam Khater, Freddie Mac’s ChiefEconomist said. “This one percentage points reduction in rates can allow…three million more mortgage-ready consumers to qualify and afford a $400,000 loan, which is the median home price,” he added.
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There are five reasons to be cautiously optimistic
The US’ inflation rate climbed to 2.1% in September from 1.5% in August, the fastest growth in nearly a year, according to data released by the Federal Reserve on Wednesday. The consumer price index (CPI) rose at an annualised rate of 2.1% last month, while the core rate, which excludes food and energy, increased to…
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Russia’s economy will be impacted by the war in Ukraine according to the chief of the International Monetary Fund
European Commissioner for Internal Affairs Kristalina Georgieva has said that one-third of the world’s economy is expected to be in a recession. “It would feel like a recession for hundreds of millions of people,” Georgieva added. The Russian central bank has said that the domestic economy might contract by 1% this year.
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There are five reasons to be cautiously optimistic
The US economy will likely go into a recession next year as the unemployment rate will climb up to between 4% and 4.5% over the next year, an economist said. John Williams, head of the San Diego Federal Reserve Bank, said that there will likely be a period of subdued growth and some softening of…
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China wants its GDP to grow by around 5% this year, a post-COVID rebound
Chinese Premier Li Keqiang said the country’s GDP growth will slow down to 6.1% in 2021, the lowest in 40 years. This is lower than the growth of 6.1% in fiscal spending in 2022. He further said that the government will only increase fiscal spending by 5.6% this year, which is lower than the growth…
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The Great Carbon Con is coming to an end
Melissa Aronczyk, an economics professor at Rutgers University, has said that when the fossil fuel industry comes up with solutions, it is the “greatest potential for conflict of interest”. She added that reducing the burning of fossil fuels is one way to address climate change. “It’s important to think about…what they say the problem is,”…
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The Fed is hiking interest rates because it is cracking down on inflation
The US Federal Reserve (Fed) has said that it needs to cut jobs in order to reach its 2% inflation target this year. “Reducing inflation is likely to require a sustained period of below-trend growth…and softening of labour market conditions,” Fed Chairman Jerome Powell said. This comes after the Fed raised its benchmark interest rate…
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The Monday Evening Briefing is what you get
China’s GDP growth is expected to remain at around 5.5% this year, which is lower than last year’s goal of “around 5.5%”, according to the government’s work report on the first day of the NPC (National People’s Congress). The economy added over 12 million jobs last year, with the unemployment rate falling to 5.5%, the…
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Holiday sales will increase by up to 8% in the next few years
The US retail sales fell 0.6% in November compared to the same month last year, marking the worst performance in nearly a year and lower than the 15.1% growth in November 2020. However, this was slightly higher than the 0.2% contraction in October and 0.6% fall in September. Consumer prices surged by 7.1% year-over-year in…
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How high will the interest rates go?
The world’s second-largest economy China on Wednesday said that its economic growth in the third quarter is expected to be about 7.5%, up from 6.8% in the previous quarter. The Chinese government also said that the global economy is expected to expand at 3.3% in the October-December quarter, higher than its earlier estimate of 2.9%.
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Russia’s economy is hurting despite the bluster of Putin
Russia’s war in Ukraine will reduce its GDP by $190 billion by 2026 compared with the country’s prewar path, according to a Bloomberg Economics report. Russia’s oil export revenues increased by 25% last year to $18.1 billion according to the IEA. However, Russia’s economic output shrank 2.1% last year, according to preliminary estimates from the…
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First-time buyers are being shut out of the market
A new report has revealed that first-time buyers need to earn over $100,000 per year to afford to buy a median-priced home. It said the median income for first-timers fell to $71,000 during the 12 months ended in June from $86,500 in the previous year. The median price of a home reached a peak of…
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Mortgage rates start to go up more quickly than they did a year ago
Mortgage rates are “critical” to the path of the housing market in the year ahead, Jeff Tucker, senior economist at Zillow, said. “Mortgage application activity sunk to a quarter-century low this week as high mortgage rates continue to weaken the housing market,” said Sam Khater, Freddie Mac’s Chief Economist. US home prices dropped for the…
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What can we expect from the jobs report on Friday?
The US Federal Reserve (Fed) on Friday raised its key interest rate by a quarter of a% for the second time this year and said, “The labour market has been further expanding.” This was the Fed’s eighth hike since December last year and its seventh in 2020 so far. The US unemployment rate fell to…
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There are clues in the Jobs report about the future of the economy
US Federal Reserve’s ‘Core PCE’ inflation index rose 0.6% in January, the lowest increase in three months, while the year-on-year rise stood at 4.7%, it said on Friday. “The annual inflation in January is down from the summer, while…the unemployment rate has remained at or near…50-year low and take-home pay has gone up,” US Vice…
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The sales of Manhattan apartments dropped off at the end of the decade
The monthly mortgage payment on a typical existing single-family home with a 20% downpayment in the US rose to $1,969 during the fourth quarter of 2019, according to NAR. The national median price of a single-family home increased by 4% year-on-year in the fourth quarter. In the previous quarter, they spent 37.8% of their family…
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The American people face a choice in 14 days, according to Joe Biden
US Social Security Administration has announced a hike in the cost-of-living adjustment for beneficiaries for the third year in a row at 8.7%, the largest adjustment to benefits in four decades. Over 50 million people will get the benefit hike, while about 18 million people will get Supplemental Security Income (SSI) increase. In August, the…
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Moody’s says to prepare for a slowcession in 2023
Goldman Sachs has said it still believes the US economy won’t get into a recession and instead will reach a soft landing where inflation moderates but growth continues. However, it added that the transition to more sustainable economic growth “has already occurred” and it looks durable. The bank expects US gross domestic product (GDP) growth…
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The number shows that inflation is still going strong
The US consumer price index rose 7.1% in September, lower than the 9.1% increase recorded in August, the government said on Thursday. Further, the annual rate of inflation in the US slowed to 7.1% for the year from 9.1% in June. While much of the services inflation is due to housing costs, this is rapidly…
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Mortgage rates went up
Mike Fratantoni, SVP and Chief Economist at the Mortgage Bankers Association, said that mortgage rates are expected to come down next year. The long-term rates like 30-year mortgage rates are a function of market expectations for the economy, he added. Mortgage application activity was at a 25-year low this week due to high mortgage rates,…
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The CEO of Bank of America stated that they were preparing for a possible debt default
The US government will run out of cash to pay its bills by July and September if Congress does not raise the debt ceiling, the Congressional Budget Office said. A default on the federal debt would produce an economic and financial catastrophe, the CBO added. The US Treasury has been taking “extraordinary measures” to prevent…
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The preferred gauge of inflation shows prices increasing again last month
Personal Consumption Expenditures Inflation (PCE) in the US rose by 6.2% in August compared to a year ago, according to Commerce Department data. The annual rise for the PCE inflation indexes declined in recent months and the annual increase for the Consumer Price Index and producer price index fell to their lowest levels since October…
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The Fed is about to raise the interest rate
Mortgage rates are expected to come down next year, according to data from Freddie Mac. “This one percentage point reduction in rates can allow as many as three million more mortgage-ready consumers to qualify and afford a $400,000 loan, which is…median home price,” said Sam Khater, Freddie Mac’s chief economist. Home prices in the US…
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The Parable of the Raisin Bran is chaired by Joe Biden
US President Joe Biden’s chief economic adviser Jared Bernstein on Thursday said that the President is “distinguished between the short-term and the long-term, between consumption and investment”. Bernstein, who now sits on the Council of Economic Advisers, added, “Ever since I’ve talked to him about the economy, he’s distinguished between the short-term and the long-term,…