Edmond de Rothschild – Macro Highlights – US Inflation, Indian PMIs & Recession signs in the US

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Economists' insight: The Fed steals Donald Trump’s thunder

KEY TAKEAWAYS OF THE WEEK

Economist insights: Increase in US inflation following Hurricane Harvey, PMIs picking up in India (p.1)

›       US inflation climbed to 2.2% in September, driven primarily by a 10.6% increase in gasoline prices over the same period, following Hurricane Harvey

›       Core inflation remained stable at 1.7%. We expect it to accelerate again slightly over the coming months, confirming our forecast for a 25 bps Fed Funds rate hike in December

›       In India, the leading indicators are back in economic expansion territory, tending to confirm the temporary nature of the shock linked to the introduction of the goods and services tax

US focus: Economic cycle set to continue in 2018 (p.3)

›       Some indicators have recently fuelled concerns that the economic cycle is nearing its end, including the low unemployment rate and the slowdown in corporate credit…

›       …but the moderate acceleration in wages, weak inflationary pressures, the good financial position of households and monetary policy are expected to support activity in the short term

›       Alongside this, the dollar’s recent depreciation and the potential tax cuts are also expected to contribute to growth in 2018, which we expect to come in at 2.5%

Macro Highlights - October 16th 2017 - US Inflation, Indian PMIs & Recession signs in the US

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