U.S. Economic News

October 16, 2019

U.S. Economic Indicators

Retail sales fell 0.3% in September but are up 4.1% from a year ago. Core sales — which exclude autos, gasoline, building materials, and food services —  were unchanged. Census Bureau Report

Business inventories were essentially unchanged in August but were up 4.2% from August of last year. Manufacturers’ sales declined 0.1% in August and were down 0.3% compared to a year ago. Census Bureau Report

The NAHB Housing Market Index rose three points to 71 in October, the highest reading since February 2018. All of the HMI subcomponents posted gains in October. NAHB Report

U.S. News

The Wall Street Journal reports that a new paper by the San Francisco Fed found that negative interest rates are a viable tool for providing economic stimulus and could have buoyed U.S. economic growth during the recovery from the financial crisis. The report examined bond markets affected by negative rate policies in Europe and Japan, observing that the introduction of negative rates tends to put downward pressure on the entire yield curve for government bonds. WSJ

According to the Financial Times, the Fed’s plan to increase the amount of cash in short-term lending markets by purchasing Treasury bills may face challenges as money market funds, among the largest bill holders, are reluctant to sell. Investors expect the Fed’s planned purchases to push down yields, giving Treasury bill holders an incentive to hold on to their bills rather than sell them now and repurchase them later at a lower yield. FT