U.S. Outlook: A few modest misses won’t deter a Fed hike

Scott Anderson
Posted by Scott Anderson
Chief Economist

The last full week of U.S. economic releases — before what is arguably the biggest FOMC meeting in nine years — came in on the underwhelming side.

Graph showing recent dip in small business optimismIn fact, three labor-related data reports all missed analyst expectations.

Highlights of my weekly analysis are below, followed by a link to the full U.S. Outlook report, delivered on Dec. 11.

Key observations:
  • The NFIB small business index sank in November to 94.8, from 96.1 in October. This reflects a souring mood of small business owners about the outlook of the U.S. economy.
  • Wholesale inventories fell 0.1% in October; not necessarily a bad thing for the economic outlook.
  • Markets have nearly fully priced in a December rate hike from the Fed at this point.
  • Next week’s FOMC meeting will true up market interest expectations for 2016 and set the investment themes for 2016.
Click here to read my full report.

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