U.S. Outlook: Election nerve flare-ups vs. decent U.S. data

Scott Anderson
Posted by Scott Anderson
Chief Economist

Sweet relief: Next Tuesday is Election Day, and we should receive a little more clarity on the economic and fiscal-policy directions the federal government is likely to pursue for the next four years.

Graph showing rises and sips in productivity ratings over last several years.But there is enough nervousness going into the election that some investors are starting to hedge their bets should the unexpected happen.

For a look at more developments, see highlights of my report below, followed by a link to the full U.S. Outlook, delivered on Nov. 4.

Key observations:
  • We finally got some better news as U.S. productivity increased at its fastest rate in two years in the third quarter.
  • We have been forecasting a modest rebound in productivity in Q3 and the quarters ahead.
  • Chronically low productivity growth in this expansion is likely behind a lot of the political angst we are seeing at the polls this year.
  • October’s payroll report (+161K nonfarm jobs) is likely a strong enough gain to keep the Fed on track for a year-end rate hike.

Click here to read my full report.

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