Articles authored by Sonu Varghese

Talk about a mixed picture from the October payroll report. Two headline numbers stand out: Nonfarm payrolls rose by 261,000 in October, more than an expected increase of 200,000 The unemployment rate rose to 3.7% The first headline suggests that employment is strong, and the economy is resilient to higher interest rates, so far. This …

The Federal Reserve (Fed) just raised rates by 0.75%, taking the federal funds rate to a target 3.75-4.0% range. This is the 4th consecutive 0.75% interest rate increase and comes as the Fed tries to get on top of inflation. The bond market has been anticipating this aggressive pace of tightening, and treasury yields have …

On the face of it, the third quarter GDP report was very positive, with growth rebounding to 2.6% quarter-over-quarter (annualized). This put at bay the question of whether the economy was in a recession, though admittedly a lot of these numbers can and will be revised in the future. But make no mistake, growth has …

Last week I wrote about how the housing market is in big trouble amid surging mortgage rates. Sales have collapsed and so have housing starts and building permits, indicating builders are pulling back. Prices have started to fall, with the Case-Shiller national home price index falling 0.9% from July to August, the second consecutive monthly …

This is a popular question now, and not a surprise given an ultra-aggressive Federal Reserve (Fed) looking to get on top of inflation. Predictably, the housing market is one of the first economic sectors to get hit, as has historically been the case when the Fed raises rates. The 30-year fixed rate mortgage was at …

It’s the middle of October and that means being surrounded by Halloween themes. I put up Halloween decorations over the weekend – always a fun activity with the kids – and so being spooked was on my mind. And one doesn’t have to go far for that this year. The Wall Street Journal (WSJ) on …

The other day I highlighted 5 charts that illustrate the strength and resiliency of the labor market. Ironically, this was perceived as “bad news” by markets. Why? Investors believe labor market strength will prompt the Federal Reserve (Fed) to continue raising rates at a torrid pace in a bid to get on top of inflation. …

Last Friday we got yet another strong payroll report, with the headlines showing payrolls growing 263,000 in September and the unemployment rate falling to 3.5%. The first three charts below show the strength and resiliency of the labor market this year. The last two are forward-looking indicators that bode well for continued employment gains. 1. …

With so much focus on the markets and the Fed, I thought it would be a good idea to take a quick look at where the economy is today. There are obviously 100’s of economic indicators we can use, including survey-based or “soft” data and “hard” data. The soft data is useful to gauge where …

Over the last couple of months, inflation numbers have come in on the softer side – the consumer price index (CPI) was flat in July and rose just 0.1% in August. But this was mostly due to falling energy prices. Excluding energy and food, “core” inflation was higher, rising 0.3% in July and 0.6% in …