Investment & Economic Talking points
- The number of unemployed persons per job opening (a sign of strength in the job market) is at its lowest point since the tech bubble of 2000. This plays into out thesis of keeping a close eye on inflation – the tighter the job market, the more likely we are to see upward wage pressure.
- Last week’s data showed continued inflation pressure with Core CPI coming in at 2.3%. Retail sales also improved, showing continued strength in the US consumer. This is a critical indicator for the US economy.
- Last weeks FED meeting was a non-event given BREXIT and mixed data globally. However – there are rumblings of a December rate hike.
- GDP was announced at 1.2% annualized for Q2 – generally regarded as a disappointment. We are monitoring for continued slowness.
Data is sending mixed signals which has been the norm for more than a year now. We are keeping an eye on the trend, not individual data points. The trend is still signaling slow growth, but the pace of that growth has started to slow. We are likely entering the later part of a business cycle where high-quality stocks and defensive positions will be added to portfolios over time.