REUTERS
"U.S. inflation coming off the boil as prices increase slowly in August"
By Lucia Mutikani
SEPTEMBER 14, 2021
WASHINGTON (Reuters) - Underlying U.S. consumer prices increased at their slowest pace in six months in August as used motor vehicle prices tumbled, suggesting that inflation had probably peaked, though it could remain high for a while amid persistent supply constraints.
The broad slowdown in price pressures reported by the Labor Department on Tuesday aligns with Federal Reserve Chair Jerome Powell’s long-held belief that high inflation is transitory.
Still, economists cautioned it was too early to celebrate and expected the U.S. central bank to lay out plans in November to start scaling back its massive monthly bond-buying program.
“Inflation remains troublingly strong, even if it is not exploding like it did earlier in the year,” said James McCann, deputy chief economist at Aberdeen Standard Investments in Boston.
“If we continue to see further step-downs in inflation over the next six months, that should ease the pressure on the Fed to quickly follow tapering with interest rate rises.”
The consumer price index excluding the volatile food and energy components edged up 0.1% last month.
That was the smallest gain since February and followed a 0.3% rise in July.
The so-called core CPI was held back by a 1.5% decline in prices for used cars and trucks, which ended five straight monthly increases.
Robust rises in prices of used cars and trucks, as well as services in industries worst affected by the COVID-19 pandemic, were the key drivers behind a heating up of inflation at the start of the year.
Airline fares plunged 9.1% in August, likely as a resurgence in infections, driven by the Delta variant of the coronavirus, sapped demand for air travel.
There were also decreases in motor vehicle rentals and insurance.
In the 12 months through August, the core CPI increased 4.0% after advancing 4.3% in the 12 months through July.
Economists polled by Reuters had forecast the core CPI would gain 0.3% for the month and increase 4.2% year-on-year.
Stocks on Wall Street were trading lower.
The dollar fell against a basket of currencies.
U.S. Treasury prices rose.
SUPPLY CONSTRAINTS REMAIN
In addition to the price surge for used cars and trucks appearing to have run its course, hotel and motel accommodation prices are now above the pre-pandemic level, suggesting moderate gains ahead.
Prices for hotels and motels accommodation fell 3.3% after shooting up 6.8% in July.
Some of the price plunge was probably because of the soaring coronavirus infections.
But bottlenecks in the supply chain remain and the labor market is tightening, pushing up wages.
There were a record 10.9 million job openings as of the end of July, forcing companies to boost wages as they compete for workers.
Amazon.com on Tuesday hiked its average starting wage to $18 per hour.
A shortage of homes is driving record house price gains and rents are going up as COVID-19 vaccinations allow companies to recall workers to offices, pulling Americans back to cities following a pandemic-fueled exodus to lower-density areas.
These factors could contribute to keeping annual inflation higher.
Owners’ equivalent rent of primary residence, which is what a homeowner would receive from renting a home, increased 0.3% in August, rising by the same margin for the fourth straight month.
“The biggest upside risk to inflation in the next six months is from the potential pass-through of higher house prices to the CPI shelter component,” said Bill Adams, a senior economist at PNC Financial in Pittsburgh, Pennsylvania.
Prices for furniture and bedding rebounded 2.3%, while appliances accelerated 1.5%, underscoring the supply chain constraints.
New motor vehicle prices rose 1.2%, marking the fourth straight month of gains above 1%.
A global semiconductor shortage, worsened by the spread of the Delta variant in East Asia has forced auto manufacturers to cut production.
Consumers also paid more for apparel.
The cost of healthcare rose at a tame 0.2% as a strong gain in prices for hospital services was offset by a decline in prescription medication.
The cost of doctor visits was unchanged.
The government reported last week that producer prices increased solidly in August, with the PPI posting its largest annual gain in nearly 11 years.
Some economists expect officials at the Fed will upgrade their inflation estimates when the U.S. central bank publishes its summary of economic projections at end of the Sept. 21-22 policy meeting.
The Fed’s preferred inflation measure for its flexible 2% target, the core personal consumption expenditures price index, increased 3.6% in the 12 months through July, matching the gain in June.
August’s data will published later this month.
The overall CPI rose 0.3% in August, the smallest increase since January, after gaining 0.5% in July.
The food index increased 0.4%, slowing down after two straight months of hefty gains, as the cost of dairy products declined.
Prices for food away from home also moderated.
Gasoline prices rose 2.8% after increasing 2.4% in July.
In the 12 months through August, the CPI increased 5.3% after soaring 5.4% on a year-on-year basis in July.
“Even with a slowdown in monthly CPI gains, big year-over-year increases will persist until well into 2022,” said Chris Low, chief economist at FHN Financial in New York.
“The slowdown in sectors sensitive to the reopening is another piece of evidence for the transitory story of inflation, but steady increases elsewhere show that inflation should stick around even after those sectors adjust.”
Reporting by Lucia Mutikani, Editing by Chizu Nomiyama, Paul Simao and Andrea Ricci
https://www.reuters.com/article/usa-eco ... SKBN2GA14W
THE ECONOMY
Re: THE ECONOMY
REUTERS
"Hurricane Ida, supply constraints slow U.S. factory production"
By Lucia Mutikani
SEPTEMBER 15, 2021
WASHINGTON (Reuters) - Production at U.S. factories slowed more than expected in August amid disruptions from Hurricane Ida and lingering shortages of raw materials and labor as the COVID-19 pandemic drags on.
An improvement is likely with other data on Wednesday showing a sharp acceleration in a measure of factory activity in New York state this month against the backdrop of strong order growth and shipments of goods.
Demand is being fueled by businesses desperate to replenish stocks after inventories were drawn down sharply in the first half of the year.
“Growth in manufacturing going forward is likely to be supported by low inventories,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics in White Plains, New York.
“But supply issues and shortages remain a constraint for now that are preventing a stronger rebound.”
Manufacturing output increased 0.2% last month, the Federal Reserve said on Wednesday.
Data for July was revised to show production surging 1.6% instead of 1.4% as previously reported.
Economists polled by Reuters had forecast manufacturing production would gain 0.4%.
The Fed estimated that Hurricane Ida, which devastated U.S. offshore energy production and knocked off power in Louisiana at the end of August, subtracted 0.2 percentage point from manufacturing output.
The hurricane led to plant closures for petrochemicals, plastic resins and petroleum refining
Factory production is 1.0% above its pre-pandemic level.
Output at auto plants edged up 0.1%.
The raw materials crunch, most evident in the automobile sector, has been worsened by the latest wave of infections driven by the Delta variant of the coronavirus, primarily in Southeast Asia, as well as by congestion at ports in China.
General Motors Co said it would cut production at its plants in Indiana, Missouri and Tennessee this month because of an ongoing microchip shortage.
Ford Motor Co is also reducing truck production.
Excluding autos, manufacturing output rose 0.2% in August.
Stocks on Wall Street were trading higher.
The dollar slipped against a basket of currencies.
U.S. Treasury prices were mixed.
IMPORT PRICES FALL
In a separate report on Wednesday, the New York Fed said its “Empire State” index on current business conditions surged to a reading of 34.3 this month from 18.3 in August.
A reading above zero suggests an expansion in regional business activity.
But supply side challenges remained, with the delivery times measure hitting a record high.
Firms in the region were very optimistic that business conditions would improve over the next six months, with capital and technology spending plans increasing markedly.
“Upbeat goods demand, rising business investment, and rebounding demand from abroad are slated to keep activity growing at a healthy clip into 2022,” said Oren Klachkin, lead U.S. economist at Oxford Economics in New York.
“However steadfast supply chain and hiring challenges will concurrently limit the expansion, and these headwinds won’t diminish significantly until the COVID crisis is effectively contained at home and abroad.”
August’s gain in manufacturing output and a 3.3% rebound in utilities raised industrial production by 0.4%.
Industrial output increased 0.8% in July. Mining production fell 0.6%, reflecting hurricane-induced disruptions to oil and gas extraction in the Gulf of Mexico.
Capacity utilization for the manufacturing sector, a measure of how fully firms are using their resources, edged up 0.1 percentage point to 76.7% in August.
Overall capacity use for the industrial sector rose 0.2 percentage point to 76.4%.
It is 3.2 percentage points below its 1972-2020 average.
Officials at the U.S. central bank tend to look at capacity use measures for signals of how much “slack” remains in the economy — how far growth has room to run before it becomes inflationary.
Inflation appears to have peaked.
A third report from the Labor Department showed import prices dropped 0.3% last month after increasing 0.4% in July.
The first decrease since October 2020 lowered the year-on-year increase to 9.0% from 10.3% in July.
The report followed on the heels of news on Tuesday that consumer prices recorded their smallest gain in seven months in August.
Fed Chair Jerome Powell has steadfastly maintained that high inflation is transitory.
The run-up in prices centered on used cars and trucks, as well as services in industries worst affected by the COVID-19 pandemic, is slowing.
But strained supply chains will likely keep inflation elevated for a while.
Imported fuel prices tumbled 2.3% last month after increasing 3.0% in July.
Petroleum prices dropped 2.4%, while the cost of imported food rose 0.6%.
Excluding fuel and food, import prices fell 0.2%.
These so-called core import prices gained 0.1% in July.
There were small gains in the prices of imported capital goods and consumer goods, excluding automobiles.
“Inflation took a little breather in August, but the race or marathon isn’t over yet,” said Jennifer Lee, a senior economist at BMO Capital Markets in Toronto.
Reporting By Lucia Mutikani; Editing by Andrea Ricci
https://www.reuters.com/article/usa-eco ... SKBN2GB1GH
"Hurricane Ida, supply constraints slow U.S. factory production"
By Lucia Mutikani
SEPTEMBER 15, 2021
WASHINGTON (Reuters) - Production at U.S. factories slowed more than expected in August amid disruptions from Hurricane Ida and lingering shortages of raw materials and labor as the COVID-19 pandemic drags on.
An improvement is likely with other data on Wednesday showing a sharp acceleration in a measure of factory activity in New York state this month against the backdrop of strong order growth and shipments of goods.
Demand is being fueled by businesses desperate to replenish stocks after inventories were drawn down sharply in the first half of the year.
“Growth in manufacturing going forward is likely to be supported by low inventories,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics in White Plains, New York.
“But supply issues and shortages remain a constraint for now that are preventing a stronger rebound.”
Manufacturing output increased 0.2% last month, the Federal Reserve said on Wednesday.
Data for July was revised to show production surging 1.6% instead of 1.4% as previously reported.
Economists polled by Reuters had forecast manufacturing production would gain 0.4%.
The Fed estimated that Hurricane Ida, which devastated U.S. offshore energy production and knocked off power in Louisiana at the end of August, subtracted 0.2 percentage point from manufacturing output.
The hurricane led to plant closures for petrochemicals, plastic resins and petroleum refining
Factory production is 1.0% above its pre-pandemic level.
Output at auto plants edged up 0.1%.
The raw materials crunch, most evident in the automobile sector, has been worsened by the latest wave of infections driven by the Delta variant of the coronavirus, primarily in Southeast Asia, as well as by congestion at ports in China.
General Motors Co said it would cut production at its plants in Indiana, Missouri and Tennessee this month because of an ongoing microchip shortage.
Ford Motor Co is also reducing truck production.
Excluding autos, manufacturing output rose 0.2% in August.
Stocks on Wall Street were trading higher.
The dollar slipped against a basket of currencies.
U.S. Treasury prices were mixed.
IMPORT PRICES FALL
In a separate report on Wednesday, the New York Fed said its “Empire State” index on current business conditions surged to a reading of 34.3 this month from 18.3 in August.
A reading above zero suggests an expansion in regional business activity.
But supply side challenges remained, with the delivery times measure hitting a record high.
Firms in the region were very optimistic that business conditions would improve over the next six months, with capital and technology spending plans increasing markedly.
“Upbeat goods demand, rising business investment, and rebounding demand from abroad are slated to keep activity growing at a healthy clip into 2022,” said Oren Klachkin, lead U.S. economist at Oxford Economics in New York.
“However steadfast supply chain and hiring challenges will concurrently limit the expansion, and these headwinds won’t diminish significantly until the COVID crisis is effectively contained at home and abroad.”
August’s gain in manufacturing output and a 3.3% rebound in utilities raised industrial production by 0.4%.
Industrial output increased 0.8% in July. Mining production fell 0.6%, reflecting hurricane-induced disruptions to oil and gas extraction in the Gulf of Mexico.
Capacity utilization for the manufacturing sector, a measure of how fully firms are using their resources, edged up 0.1 percentage point to 76.7% in August.
Overall capacity use for the industrial sector rose 0.2 percentage point to 76.4%.
It is 3.2 percentage points below its 1972-2020 average.
Officials at the U.S. central bank tend to look at capacity use measures for signals of how much “slack” remains in the economy — how far growth has room to run before it becomes inflationary.
Inflation appears to have peaked.
A third report from the Labor Department showed import prices dropped 0.3% last month after increasing 0.4% in July.
The first decrease since October 2020 lowered the year-on-year increase to 9.0% from 10.3% in July.
The report followed on the heels of news on Tuesday that consumer prices recorded their smallest gain in seven months in August.
Fed Chair Jerome Powell has steadfastly maintained that high inflation is transitory.
The run-up in prices centered on used cars and trucks, as well as services in industries worst affected by the COVID-19 pandemic, is slowing.
But strained supply chains will likely keep inflation elevated for a while.
Imported fuel prices tumbled 2.3% last month after increasing 3.0% in July.
Petroleum prices dropped 2.4%, while the cost of imported food rose 0.6%.
Excluding fuel and food, import prices fell 0.2%.
These so-called core import prices gained 0.1% in July.
There were small gains in the prices of imported capital goods and consumer goods, excluding automobiles.
“Inflation took a little breather in August, but the race or marathon isn’t over yet,” said Jennifer Lee, a senior economist at BMO Capital Markets in Toronto.
Reporting By Lucia Mutikani; Editing by Andrea Ricci
https://www.reuters.com/article/usa-eco ... SKBN2GB1GH
Re: THE ECONOMY
REUTERS
"U.S. House Democrats advance tax-hike plan as rifts open over Biden spending bill"
By David Lawder and Ahmed Aboulenein
September 15, 2021
WASHINGTON, Sept 15 (Reuters) - Legislation to raise taxes on the wealthy and corporations advanced out of a U.S. House of Representatives committee on Wednesday to help fund President Joe Biden's $3.5 trillion social spending plan, but a provision to slash drug prices stalled elsewhere on Capitol Hill.
Many elements of Democrats' sweeping "reconciliation" bill remain in flux due to the competing demands of the party's centrists and progressives.
Biden met with two influential moderate Senate Democrats on the legislation at the White House.
The Democratic-led House Ways and Means Committee voted 24-19 to approve the tax-related portions of the bill, which include raising the top income tax rate to 39.6% from 37% and the top corporate tax rate to 26.5% from 21%.
The plan boosts the capital gains tax rate to 25% from 20% for Americans with taxable income above $400,000 and adds a 3% surtax on income above $5 million.
The committee's work will be treated as recommendations to House and Senate leaders as they craft final versions of the massive tax and spending bill in coming weeks.
Representative Stephanie Murphy was the lone Democrat to vote against the tax plan, as did all Republicans on the panel.
Murphy said she supported some elements such as tax breaks for green energy.
"But there are also spending and tax provisions that give me pause, and so I cannot vote for the bill at this early stage," she said in a statement, adding the final version can be "fiscally responsible."
Democrats, who aim to pass the bill without the support of Republicans using budget reconciliation rules, cannot afford to lose more than three votes in the House and any votes in the Senate.
MEDICARE DEADLOCK
Rifts between Democratic moderates and progressives also were on display at the House Energy and Commerce Committee, where a 29-29 vote blocked a provision that would allow the Medicare healthcare program for seniors to negotiate lower drug prices with pharmaceutical companies.
Three Democrats sided with Republicans in opposing the measure, long sought by progressives to beat back healthcare costs, but opposed by drugmakers as stifling innovation.
A spokesman for House Speaker Nancy Pelosi said the provision "will remain a cornerstone of the Build Back Better Act as work continues" on a final version.
The drug pricing plan could be reinstated due to the House Ways and Means Committee approving identical language in its legislation.
The House Rules Committee could also add it to a final version ahead of a floor vote.
MANCHIN, SINEMA LEVERAGE
Biden met separately with moderate Democratic Senators Joe Manchin and Kyrsten Sinema on Wednesday to discuss Democratic-backed domestic spending legislation, the White House said.
Democrats hold a razor-thin majority in the Senate, making Manchin and Sinema essential to the $3.5 trillion bill's prospects.
White House press secretary Jen Psaki told reporters the purpose of the meetings was to discuss a “path forward” on Biden’s legislation.
Sinema spokesman John LaBombard said: "Today’s meeting was productive, and Kyrsten is continuing to work in good faith with her colleagues and President Biden as this legislation develops."
LaBombard did not provide details of the conversation.
Manchin was scheduled to discuss the wide-ranging spending and tax bill on Wednesday evening, Psaki indicated.
The legislation - opposed by Republicans - aims to supplement a separate bipartisan $1 trillion infrastructure bill and would focus on matters including education, childcare and climate-related projects.
Manchin said over the weekend he would not back a $3.5 trillion package and urged a slimmer version, putting him at odds with other Democrats backing the larger bill to tackle the party's major policy goals while they maintain a narrow hold on Congress.
Reporting by David Lawder, Ahmed Abouleinen and Richard Cowan; Additional reporting by Susan Heavey, Trevor Hunnicutt and Susan Cornwell; Editing by Jonathan Oatis and Peter Cooney
https://www.reuters.com/world/us/biden- ... 021-09-15/
"U.S. House Democrats advance tax-hike plan as rifts open over Biden spending bill"
By David Lawder and Ahmed Aboulenein
September 15, 2021
WASHINGTON, Sept 15 (Reuters) - Legislation to raise taxes on the wealthy and corporations advanced out of a U.S. House of Representatives committee on Wednesday to help fund President Joe Biden's $3.5 trillion social spending plan, but a provision to slash drug prices stalled elsewhere on Capitol Hill.
Many elements of Democrats' sweeping "reconciliation" bill remain in flux due to the competing demands of the party's centrists and progressives.
Biden met with two influential moderate Senate Democrats on the legislation at the White House.
The Democratic-led House Ways and Means Committee voted 24-19 to approve the tax-related portions of the bill, which include raising the top income tax rate to 39.6% from 37% and the top corporate tax rate to 26.5% from 21%.
The plan boosts the capital gains tax rate to 25% from 20% for Americans with taxable income above $400,000 and adds a 3% surtax on income above $5 million.
The committee's work will be treated as recommendations to House and Senate leaders as they craft final versions of the massive tax and spending bill in coming weeks.
Representative Stephanie Murphy was the lone Democrat to vote against the tax plan, as did all Republicans on the panel.
Murphy said she supported some elements such as tax breaks for green energy.
"But there are also spending and tax provisions that give me pause, and so I cannot vote for the bill at this early stage," she said in a statement, adding the final version can be "fiscally responsible."
Democrats, who aim to pass the bill without the support of Republicans using budget reconciliation rules, cannot afford to lose more than three votes in the House and any votes in the Senate.
MEDICARE DEADLOCK
Rifts between Democratic moderates and progressives also were on display at the House Energy and Commerce Committee, where a 29-29 vote blocked a provision that would allow the Medicare healthcare program for seniors to negotiate lower drug prices with pharmaceutical companies.
Three Democrats sided with Republicans in opposing the measure, long sought by progressives to beat back healthcare costs, but opposed by drugmakers as stifling innovation.
A spokesman for House Speaker Nancy Pelosi said the provision "will remain a cornerstone of the Build Back Better Act as work continues" on a final version.
The drug pricing plan could be reinstated due to the House Ways and Means Committee approving identical language in its legislation.
The House Rules Committee could also add it to a final version ahead of a floor vote.
MANCHIN, SINEMA LEVERAGE
Biden met separately with moderate Democratic Senators Joe Manchin and Kyrsten Sinema on Wednesday to discuss Democratic-backed domestic spending legislation, the White House said.
Democrats hold a razor-thin majority in the Senate, making Manchin and Sinema essential to the $3.5 trillion bill's prospects.
White House press secretary Jen Psaki told reporters the purpose of the meetings was to discuss a “path forward” on Biden’s legislation.
Sinema spokesman John LaBombard said: "Today’s meeting was productive, and Kyrsten is continuing to work in good faith with her colleagues and President Biden as this legislation develops."
LaBombard did not provide details of the conversation.
Manchin was scheduled to discuss the wide-ranging spending and tax bill on Wednesday evening, Psaki indicated.
The legislation - opposed by Republicans - aims to supplement a separate bipartisan $1 trillion infrastructure bill and would focus on matters including education, childcare and climate-related projects.
Manchin said over the weekend he would not back a $3.5 trillion package and urged a slimmer version, putting him at odds with other Democrats backing the larger bill to tackle the party's major policy goals while they maintain a narrow hold on Congress.
Reporting by David Lawder, Ahmed Abouleinen and Richard Cowan; Additional reporting by Susan Heavey, Trevor Hunnicutt and Susan Cornwell; Editing by Jonathan Oatis and Peter Cooney
https://www.reuters.com/world/us/biden- ... 021-09-15/
Re: THE ECONOMY
CNBC
"Retail sales post surprise gain as consumers show strength despite delta fears"
Jeff Cox @JEFF.COX.7528 @JEFFCOXCNBCCOM
KEY POINTS
* Retail sales rose 0.7% in August versus expectations for a 0.8% decline.
* Excluding autos, sales increased 1.8% versus the Dow Jones estimate for a 0.1% gain.
* Weekly jobless claims increased to 332,000 versus the estimate for 320,000.[/b]
Retail sales posted a surprise gain in August despite fears that escalating Covid cases and supply chain issues would hold back consumers, the Census Bureau reported Thursday.
Sales increased 0.7% for the month against the Dow Jones estimate of a decline of 0.8%.
A separate economic report showed that weekly jobless claims increased to 332,000 for the week ended Sept. 11, according to the Labor Department.
The Dow Jones estimate was for 320,000.
Economists had expected that consumers cut back their activity as the delta variant continued its tear through the U.S.
Persistent supply chain bottlenecks also were expected to hold back spending as in-demand goods were hard to find.
The pandemic’s impact did show up in sales at bars and restaurants, which were flat for the month though still 31.9% ahead of where they were a year ago.
However, sales were strong for most areas during the month, when back-to-school shopping generally results in a pickup in activity, especially so this year as schools prepared to welcome back students after a year of remote learning.
The headline number would have been even better without a 3.6% monthly drop in auto-related activity; excluding the sector, sales rose 1.8%, also well above the 0.1% expected gain.
With fears rising over the pandemic, shoppers turned online, with nonstore sales jumping 5.3%.
Furniture and home furnishing also saw a healthy 3.7% increase, while general merchandise sales rose 3.5%.
Electronics and appliances stores saw a 3.1% drop, while sporting goods and music stores fell 2.7%.
The numbers overall reflected a more resilient consumer, with sales up 15.1% from the same period a year ago.
The retail upside surprise was tempered slightly with a disappointing read on jobless claims.
Initial filings increased 20,000 from a week ago after posting a fresh pandemic-era low.
Still, the four-week moving average, which accounts for weekly volatility, declined to 335,750, a drop of 4,250 that brought the figure to its lowest point since March 14, 2020, at the pandemic’s onset.
The claims total came under heavy seasonal adjustments, as the unadjusted figure showed a drop in filings of 23,331 to 262,619.
Continuing claims also declined, falling by 187,000 to 2.66 million, also a new low since Covid hit.
The four-week moving average nudged lower to about 2.81 million.
However, those receiving compensation under all programs actually increased just ahead of the expiration of enhanced federal jobless benefits.
That total, through Aug. 28 and thus before the expiration, rose by 178,937 to 12.1 million.
In a separate economic report, the Philadelphia Federal Reserve reported its manufacturing activity index rose 11 points to 30.7, representing the percentage difference between firms reporting expanding activity against those seeing contraction.
That number was well ahead of the Dow Jones estimate of 18.7.
https://www.cnbc.com/2021/09/16/retail- ... rcent.html
"Retail sales post surprise gain as consumers show strength despite delta fears"
Jeff Cox @JEFF.COX.7528 @JEFFCOXCNBCCOM
KEY POINTS
* Retail sales rose 0.7% in August versus expectations for a 0.8% decline.
* Excluding autos, sales increased 1.8% versus the Dow Jones estimate for a 0.1% gain.
* Weekly jobless claims increased to 332,000 versus the estimate for 320,000.[/b]
Retail sales posted a surprise gain in August despite fears that escalating Covid cases and supply chain issues would hold back consumers, the Census Bureau reported Thursday.
Sales increased 0.7% for the month against the Dow Jones estimate of a decline of 0.8%.
A separate economic report showed that weekly jobless claims increased to 332,000 for the week ended Sept. 11, according to the Labor Department.
The Dow Jones estimate was for 320,000.
Economists had expected that consumers cut back their activity as the delta variant continued its tear through the U.S.
Persistent supply chain bottlenecks also were expected to hold back spending as in-demand goods were hard to find.
The pandemic’s impact did show up in sales at bars and restaurants, which were flat for the month though still 31.9% ahead of where they were a year ago.
However, sales were strong for most areas during the month, when back-to-school shopping generally results in a pickup in activity, especially so this year as schools prepared to welcome back students after a year of remote learning.
The headline number would have been even better without a 3.6% monthly drop in auto-related activity; excluding the sector, sales rose 1.8%, also well above the 0.1% expected gain.
With fears rising over the pandemic, shoppers turned online, with nonstore sales jumping 5.3%.
Furniture and home furnishing also saw a healthy 3.7% increase, while general merchandise sales rose 3.5%.
Electronics and appliances stores saw a 3.1% drop, while sporting goods and music stores fell 2.7%.
The numbers overall reflected a more resilient consumer, with sales up 15.1% from the same period a year ago.
The retail upside surprise was tempered slightly with a disappointing read on jobless claims.
Initial filings increased 20,000 from a week ago after posting a fresh pandemic-era low.
Still, the four-week moving average, which accounts for weekly volatility, declined to 335,750, a drop of 4,250 that brought the figure to its lowest point since March 14, 2020, at the pandemic’s onset.
The claims total came under heavy seasonal adjustments, as the unadjusted figure showed a drop in filings of 23,331 to 262,619.
Continuing claims also declined, falling by 187,000 to 2.66 million, also a new low since Covid hit.
The four-week moving average nudged lower to about 2.81 million.
However, those receiving compensation under all programs actually increased just ahead of the expiration of enhanced federal jobless benefits.
That total, through Aug. 28 and thus before the expiration, rose by 178,937 to 12.1 million.
In a separate economic report, the Philadelphia Federal Reserve reported its manufacturing activity index rose 11 points to 30.7, representing the percentage difference between firms reporting expanding activity against those seeing contraction.
That number was well ahead of the Dow Jones estimate of 18.7.
https://www.cnbc.com/2021/09/16/retail- ... rcent.html
Re: THE ECONOMY
REUTERS
"U.S. retail sales surprise to upside in strong boost to economy"
By Lucia Mutikani
September 16, 2021
Summary
* Retail sales increase 0.7% in August
* Core retail sales surge 2.5%; July revised down
* Weekly jobless claims increase 20,000 to 332,000
WASHINGTON, Sept 16 (Reuters) - U.S. retail sales unexpectedly increased in August, likely boosted by back-to-school shopping and child tax credit payments from the government, which could temper expectations for a sharp slowdown in economic growth in the third quarter.
The surprise rebound in retail sales reported by the Commerce Department on Thursday defied slumping consumer confidence.
Sales were driven by a surge in online purchases, which offset a continued decline at auto dealerships.
But sales in July were much weaker than initially estimated.
Economists have been downgrading their gross domestic product estimates for the current quarter, citing plunging motor vehicle sales, which are the result of an acute inventory shortage, and a flare-up of COVID-19 infections fueled by the Delta variant of the coronavirus.
"U.S. consumption is not slowing as quickly as it appeared a month ago despite the fading stimulus, and the Delta variant did not much affect the industries feeding into retail sales," said Chris Low, chief economist at FHN Financial in New York.
"The economy continued to hum in August."
Retail sales rose 0.7% last month.
Data for July was revised down to show retail sales declining 1.8% instead of 1.1% as previously reported.
Economists polled by Reuters had forecast retail sales would drop 0.8%.
Sales increased 15.1% from a year ago and are 17.7% above their pre-pandemic level.
They are holding up even as spending is shifting back from goods to services like travel and entertainment.
Retail sales are mostly goods, with services such as healthcare, education, travel and hotel accommodation making up the remaining portion of consumer spending.
Online retail sales rebounded 5.3% after tumbling 4.6% in July.
Most school districts started their 2021-2022 academic year in August, with in-person learning resuming after last year's shift to online classes because of the pandemic.
Qualifying households in mid-July started receiving money under the expanded child tax credit program, which will run through December.
Sales at clothing stores edged up 0.1% last month.
There were strong gains in receipts at building material and furniture stores.
But sales at auto dealerships tumbled 3.6% after declining 4.6% in July.
An ongoing global shortage of microchips is forcing has automakers to cut production.
The semiconductor crunch, which has been worsened by the latest COVID-19 wave, is also causing shortages of some electronic goods.
There is also congestion at ports in China.
Sales at electronics and appliance stores fell 3.1%.
There was also a decrease in receipts at sporting goods, hobby, musical instrument and book stores.
With coronavirus infections surging, the flow of traffic to restaurants and bars ebbed, keeping sales flat.
Restaurants and bars are the only services category in the retail sales report.
Excluding automobiles, gasoline, building materials and food services, retail sales rebounded 2.5% last month after a downwardly revised 1.9% decrease in July.
These so-called core retail sales correspond most closely to the consumer spending component of GDP.
They were previously estimated to have dropped 1.0% in July.
Stocks on Wall Street were trading lower.
The dollar rose against a basket of currencies.
U.S. Treasury prices fell.
GROWTH ESTIMATES
The National Retail Federation said the rise in sales despite the headwinds reflected the continued strength of the American consumer and the resilience of the nation's retailers.
"We maintain our confidence in the historic strength of consumers and fully expect a record year for retail sales and a strong holiday season for retailers," NRF President Matthew Shay said.
Americans are sitting on at least $2.5 trillion in excess savings accumulated during the pandemic.
Wages are rising as companies scramble to fill a record 10.9 million job openings.
A separate report from the Labor Department on Thursday showed initial claims for state jobless benefits rose 20,000 to a seasonally adjusted 332,000 for the week ended Sept. 11.
Claims were likely boosted by Hurricane Ida, which devastated U.S. offshore energy production and knocked out power in Louisiana.
Ida also drenched Mississippi and caused historic flooding in New York and New Jersey.
The number of people continuing to receive benefits after an initial week of aid fell 187,000 to 2.665 million in the week ended Sept. 4, the lowest level since mid-March 2020.
The expiration of federal government-funded benefits early this month is expected to boost the labor pool.
"There is no evidence here that the surge in COVID cases related to the Delta variant is forcing a retrenchment in the economy," said Conrad DeQuadros, senior economic advisor at Brean Capital in New York.
A third report from the Philadelphia Federal Reserve showed its business activity index jumped to a reading of 30.7 in September from 19.4 in August.
A reading above zero indicates growth in manufacturing in the region, which covers eastern Pennsylvania, southern New Jersey and Delaware.
Manufacturers reported a moderation in input prices, which fits in with recent data suggesting that inflation had probably peaked.
They also increased hours for workers as they struggled to find labor.
Though expectations moderated, manufacturers were upbeat about business conditions over the next six months.
Tanking motor vehicle sales and struggles by businesses to replenish stocks have prompted economists to slash their GDP growth estimates for the third quarter.
A fourth report from the Commerce Department on Thursday showed inventory accumulation slowed in July.
On Wednesday, economists at JPMorgan again trimmed their third-quarter GDP growth forecast to a 5.0% annualized rate from a 7.0% pace.
The Federal Reserve's "Beige Book" report last week showed "economic growth downshifted slightly to a moderate pace in early July through August."
But after the release of the retail sales report on Thursday, economists at Morgan Stanley raised their third-quarter GDP growth estimate to a 5.0% rate from a 3.3% pace.
Goldman Sachs raised its forecast to a 4.5% pace from a 3.5% rate, having lowered it to a 5.25% pace early this month.
The economy grew at a 6.6% rate in the second quarter.
Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Paul Simao
https://www.reuters.com/world/us/us-ret ... 021-09-16/
"U.S. retail sales surprise to upside in strong boost to economy"
By Lucia Mutikani
September 16, 2021
Summary
* Retail sales increase 0.7% in August
* Core retail sales surge 2.5%; July revised down
* Weekly jobless claims increase 20,000 to 332,000
WASHINGTON, Sept 16 (Reuters) - U.S. retail sales unexpectedly increased in August, likely boosted by back-to-school shopping and child tax credit payments from the government, which could temper expectations for a sharp slowdown in economic growth in the third quarter.
The surprise rebound in retail sales reported by the Commerce Department on Thursday defied slumping consumer confidence.
Sales were driven by a surge in online purchases, which offset a continued decline at auto dealerships.
But sales in July were much weaker than initially estimated.
Economists have been downgrading their gross domestic product estimates for the current quarter, citing plunging motor vehicle sales, which are the result of an acute inventory shortage, and a flare-up of COVID-19 infections fueled by the Delta variant of the coronavirus.
"U.S. consumption is not slowing as quickly as it appeared a month ago despite the fading stimulus, and the Delta variant did not much affect the industries feeding into retail sales," said Chris Low, chief economist at FHN Financial in New York.
"The economy continued to hum in August."
Retail sales rose 0.7% last month.
Data for July was revised down to show retail sales declining 1.8% instead of 1.1% as previously reported.
Economists polled by Reuters had forecast retail sales would drop 0.8%.
Sales increased 15.1% from a year ago and are 17.7% above their pre-pandemic level.
They are holding up even as spending is shifting back from goods to services like travel and entertainment.
Retail sales are mostly goods, with services such as healthcare, education, travel and hotel accommodation making up the remaining portion of consumer spending.
Online retail sales rebounded 5.3% after tumbling 4.6% in July.
Most school districts started their 2021-2022 academic year in August, with in-person learning resuming after last year's shift to online classes because of the pandemic.
Qualifying households in mid-July started receiving money under the expanded child tax credit program, which will run through December.
Sales at clothing stores edged up 0.1% last month.
There were strong gains in receipts at building material and furniture stores.
But sales at auto dealerships tumbled 3.6% after declining 4.6% in July.
An ongoing global shortage of microchips is forcing has automakers to cut production.
The semiconductor crunch, which has been worsened by the latest COVID-19 wave, is also causing shortages of some electronic goods.
There is also congestion at ports in China.
Sales at electronics and appliance stores fell 3.1%.
There was also a decrease in receipts at sporting goods, hobby, musical instrument and book stores.
With coronavirus infections surging, the flow of traffic to restaurants and bars ebbed, keeping sales flat.
Restaurants and bars are the only services category in the retail sales report.
Excluding automobiles, gasoline, building materials and food services, retail sales rebounded 2.5% last month after a downwardly revised 1.9% decrease in July.
These so-called core retail sales correspond most closely to the consumer spending component of GDP.
They were previously estimated to have dropped 1.0% in July.
Stocks on Wall Street were trading lower.
The dollar rose against a basket of currencies.
U.S. Treasury prices fell.
GROWTH ESTIMATES
The National Retail Federation said the rise in sales despite the headwinds reflected the continued strength of the American consumer and the resilience of the nation's retailers.
"We maintain our confidence in the historic strength of consumers and fully expect a record year for retail sales and a strong holiday season for retailers," NRF President Matthew Shay said.
Americans are sitting on at least $2.5 trillion in excess savings accumulated during the pandemic.
Wages are rising as companies scramble to fill a record 10.9 million job openings.
A separate report from the Labor Department on Thursday showed initial claims for state jobless benefits rose 20,000 to a seasonally adjusted 332,000 for the week ended Sept. 11.
Claims were likely boosted by Hurricane Ida, which devastated U.S. offshore energy production and knocked out power in Louisiana.
Ida also drenched Mississippi and caused historic flooding in New York and New Jersey.
The number of people continuing to receive benefits after an initial week of aid fell 187,000 to 2.665 million in the week ended Sept. 4, the lowest level since mid-March 2020.
The expiration of federal government-funded benefits early this month is expected to boost the labor pool.
"There is no evidence here that the surge in COVID cases related to the Delta variant is forcing a retrenchment in the economy," said Conrad DeQuadros, senior economic advisor at Brean Capital in New York.
A third report from the Philadelphia Federal Reserve showed its business activity index jumped to a reading of 30.7 in September from 19.4 in August.
A reading above zero indicates growth in manufacturing in the region, which covers eastern Pennsylvania, southern New Jersey and Delaware.
Manufacturers reported a moderation in input prices, which fits in with recent data suggesting that inflation had probably peaked.
They also increased hours for workers as they struggled to find labor.
Though expectations moderated, manufacturers were upbeat about business conditions over the next six months.
Tanking motor vehicle sales and struggles by businesses to replenish stocks have prompted economists to slash their GDP growth estimates for the third quarter.
A fourth report from the Commerce Department on Thursday showed inventory accumulation slowed in July.
On Wednesday, economists at JPMorgan again trimmed their third-quarter GDP growth forecast to a 5.0% annualized rate from a 7.0% pace.
The Federal Reserve's "Beige Book" report last week showed "economic growth downshifted slightly to a moderate pace in early July through August."
But after the release of the retail sales report on Thursday, economists at Morgan Stanley raised their third-quarter GDP growth estimate to a 5.0% rate from a 3.3% pace.
Goldman Sachs raised its forecast to a 4.5% pace from a 3.5% rate, having lowered it to a 5.25% pace early this month.
The economy grew at a 6.6% rate in the second quarter.
Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Paul Simao
https://www.reuters.com/world/us/us-ret ... 021-09-16/
Re: THE ECONOMY
CNBC
"Fed Chief Powell, other officials owned securities central bank bought during Covid pandemic"
Steve Liesman @STEVELIESMAN
PUBLISHED FRI, SEP 17 2021
KEY POINTS
* Federal Reserve Chairman Jerome Powell has ordered a review of ethics rules for the central bank after an outcry over officials owning individual securities.
* CNBC found Powell owned municipal bonds of the same type bought by the Fed during the Covid-19 pandemic in 2020.
* Two regional Fed presidents likewise owned assets of the same type the Fed was buying as the coronavirus threatened the U.S. economy’s health.
* The central bank’s code of conduct says officials “should be careful to avoid any dealings or other conduct that might convey even an appearance of conflict between their personal interests, the interests of the system, and the public interest.”
Amid an outcry about Federal Reserve officials owning and trading individual securities, an in-depth look by CNBC at officials’ financial disclosures found three who last year held assets of the same type the Fed itself was buying, including Chairman Jerome Powell.
None of these holdings or transactions appeared to violate the Fed’s code of conduct.
But they raise further questions about the Fed’s conflict of interest policies and the oversight of central bank officials.
Powell held between $1.25 million and $2.5 million of municipal bonds in family trusts over which he is said to have no control.
They were just a small portion of his total reported assets.
While the bonds were purchased before 2019, they were held while the Fed last year bought more than $5 billion in munis, including one from the state of Illinois purchased by his family trust in 2016.
Boston Fed President Eric Rosengren held between $151,000 and $800,000 worth of real estate investment trusts that owned mortgage-backed securities.
He made as many as 37 separate trades in the four REITS while the Fed purchased almost $700 billion in MBS.
Richmond Fed President Thomas Barkin held $1.35 million to $3 million in individual corporate bonds purchased before 2020.
They include bonds of Pepsi, Home Depot and Eli Lilly.
The Fed last year opened a corporate bond-buying facility and purchased $46.5 billion of corporate bonds.
Among those questions: Should the Fed have banned officials from holding, buying and selling the same assets the Fed itself was buying last year when it dramatically widened the types of assets it would purchase in response to the pandemic?
The Fed’s own code of conduct says officials “should be careful to avoid any dealings or other conduct that might convey even an appearance of conflict between their personal interests, the interests of the system, and the public interest.”
In response to CNBC questions asked in the process of our research, a Fed spokesperson released a statement Thursday saying Powell ordered a review last week of the Fed’s ethics rules surrounding “permissible financial holdings and activities by senior Fed officials.”
A Fed spokesperson told CNBC that Powell had no say over the central bank’s individual municipal bond purchases and no say over the investments in his family’s trusts.
A Fed ethics officer determined that the holdings did not violate government rules.
Barkin declined to comment but he did not appear to have any say over the individual corporate bonds purchased by the Fed.
Rosengren has announced he would sell his individual positions and stop trading while he is president.
Dallas Fed President Robert Kaplan, who actively traded millions of dollars of individual stocks, also said he would no longer trade and would sell his individual positions.
But he said his trade did not violate Fed ethics rules.
A spokesman for Rosengren told CNBC that he “made sure his personal saving and investment transactions complied with what was permissible under Fed ethics rules.”
But Dennis Kelleher, CEO of the nonprofit Better Markets, said if some of these Fed actions are not against the rules, the rules need to change.
“To think that such trading is acceptable because it is supposedly allowed by Fed’s current policies only highlights that the Fed’s policies are woefully deficient,” Kelleher told CNBC.
While trading by Rosengren and Kaplan was not conducted during the so-called blackout period, when Fed officials are not allowed to talk publicly about monetary policy or trade, Kelleher said during a crisis like last year, “the whole year should be considered a blackout period” because Fed officials are constantly talking and crafting policy in response to fast-moving events.
Correction: The Fed itself bought $5 billion to $6 billion in municipal securities last year. The previous figure used in the story incorrectly included money that came from the Treasury used to buffer against losses.
Data also provided by Reuters
https://www.cnbc.com/2021/09/17/fed-off ... licts.html
"Fed Chief Powell, other officials owned securities central bank bought during Covid pandemic"
Steve Liesman @STEVELIESMAN
PUBLISHED FRI, SEP 17 2021
KEY POINTS
* Federal Reserve Chairman Jerome Powell has ordered a review of ethics rules for the central bank after an outcry over officials owning individual securities.
* CNBC found Powell owned municipal bonds of the same type bought by the Fed during the Covid-19 pandemic in 2020.
* Two regional Fed presidents likewise owned assets of the same type the Fed was buying as the coronavirus threatened the U.S. economy’s health.
* The central bank’s code of conduct says officials “should be careful to avoid any dealings or other conduct that might convey even an appearance of conflict between their personal interests, the interests of the system, and the public interest.”
Amid an outcry about Federal Reserve officials owning and trading individual securities, an in-depth look by CNBC at officials’ financial disclosures found three who last year held assets of the same type the Fed itself was buying, including Chairman Jerome Powell.
None of these holdings or transactions appeared to violate the Fed’s code of conduct.
But they raise further questions about the Fed’s conflict of interest policies and the oversight of central bank officials.
Powell held between $1.25 million and $2.5 million of municipal bonds in family trusts over which he is said to have no control.
They were just a small portion of his total reported assets.
While the bonds were purchased before 2019, they were held while the Fed last year bought more than $5 billion in munis, including one from the state of Illinois purchased by his family trust in 2016.
Boston Fed President Eric Rosengren held between $151,000 and $800,000 worth of real estate investment trusts that owned mortgage-backed securities.
He made as many as 37 separate trades in the four REITS while the Fed purchased almost $700 billion in MBS.
Richmond Fed President Thomas Barkin held $1.35 million to $3 million in individual corporate bonds purchased before 2020.
They include bonds of Pepsi, Home Depot and Eli Lilly.
The Fed last year opened a corporate bond-buying facility and purchased $46.5 billion of corporate bonds.
Among those questions: Should the Fed have banned officials from holding, buying and selling the same assets the Fed itself was buying last year when it dramatically widened the types of assets it would purchase in response to the pandemic?
The Fed’s own code of conduct says officials “should be careful to avoid any dealings or other conduct that might convey even an appearance of conflict between their personal interests, the interests of the system, and the public interest.”
In response to CNBC questions asked in the process of our research, a Fed spokesperson released a statement Thursday saying Powell ordered a review last week of the Fed’s ethics rules surrounding “permissible financial holdings and activities by senior Fed officials.”
A Fed spokesperson told CNBC that Powell had no say over the central bank’s individual municipal bond purchases and no say over the investments in his family’s trusts.
A Fed ethics officer determined that the holdings did not violate government rules.
Barkin declined to comment but he did not appear to have any say over the individual corporate bonds purchased by the Fed.
Rosengren has announced he would sell his individual positions and stop trading while he is president.
Dallas Fed President Robert Kaplan, who actively traded millions of dollars of individual stocks, also said he would no longer trade and would sell his individual positions.
But he said his trade did not violate Fed ethics rules.
A spokesman for Rosengren told CNBC that he “made sure his personal saving and investment transactions complied with what was permissible under Fed ethics rules.”
But Dennis Kelleher, CEO of the nonprofit Better Markets, said if some of these Fed actions are not against the rules, the rules need to change.
“To think that such trading is acceptable because it is supposedly allowed by Fed’s current policies only highlights that the Fed’s policies are woefully deficient,” Kelleher told CNBC.
While trading by Rosengren and Kaplan was not conducted during the so-called blackout period, when Fed officials are not allowed to talk publicly about monetary policy or trade, Kelleher said during a crisis like last year, “the whole year should be considered a blackout period” because Fed officials are constantly talking and crafting policy in response to fast-moving events.
Correction: The Fed itself bought $5 billion to $6 billion in municipal securities last year. The previous figure used in the story incorrectly included money that came from the Treasury used to buffer against losses.
Data also provided by Reuters
https://www.cnbc.com/2021/09/17/fed-off ... licts.html
Re: THE ECONOMY
REUTERS
"Analysis-Torrid Moderna stock rally cools over booster shot doubts"
By Lewis Krauskopf
SEPTEMBER 17, 2021
NEW YORK (Reuters) - Debate over the need for COVID-19 booster shots is clouding the outlook for Moderna Inc’s high-flying shares after the U.S. biotechnology company’s stock price soared as much as 360% this year, making it the best performer in the S&P 500.
A panel of expert outside advisers to the U.S. Food and Drug Administration on Friday voted to recommend here COVID-19 vaccine booster shots for Americans 65 and older and those at high risk of severe illness, but rejected a request for broader approval.
The application for boosters for all Americans age 16 and older had been brought by Pfizer Inc for the vaccine it developed with German partner BioNTech SE.
Moderna, whose vaccine is based on a similar messenger RNA (mRNA) technology, applied earlier this month here to allow use of a booster dose.
Moderna has benefited from being one of the dominant coronavirus vaccines, but its shares have pulled back 11% since hitting a closing high of $484.47 in early August.
One factor in the rally stalling, analysts said, is a muddier outlook for additional booster COVID-19 shots, on top of the initial two-dose regimen.
“When (the stocks) ran up, I think it was expecting a booster shot to be given to everyone,” said Jeff Jonas, a portfolio manager at Gabelli Funds.
“Now I think it’s maybe a little less certain that that extra demand is going to be there.”
The U.S. government had said it plans to start offering booster shots here widely as soon as next week.
But experts have questioned whether there is evidence to back such a plan.
This week, leading scientists, including two departing U.S. Food and Drug Administration officials, said in an influential medical journal that additional booster shots are not needed here for the general population.
In a note earlier this week, SVB Leerink analysts estimated that the booster market is likely to add another $3 billion to $4 billion in U.S. revenue potential for existing vaccines.
Substantial booster revenue for the companies “are already contemplated in consensus estimates,” the Leerink analysts said, “making the stock impact for Moderna in particular dependent on the breadth of the recommended population and boosting interval.”
An already powerful rally in Moderna shares went into overdrive this summer, as index fund managers were forced to buy the stock after it was added to the S&P 500, and as concerns rose over a resurgence in COVID-19 cases due to spread of the virulent Delta variant of the virus.
The stock has been volatile since joining the index in mid July, with Moderna shares being either the biggest daily percentage gainer or loser in the S&P 500 in 10 trading days since the stock joined - a quarter of all the sessions over that time.
Analysts overall appear to be cautious about the stock, even as the company is developing other products, including a vaccine that combines a booster dose against COVID-19 with its experimental flu shot here.
The median price target for Moderna shares among 12 analysts is $391, according to Refinitiv, over 11% below Thursday’s closing price of $440.65.
Using earnings estimates for the next 12 months, Moderna shares trade at a price-to-earnings ratio of 15.8, according to Refinitiv Datastream.
That is more expensive than the 11.4 times P/E of S&P 500 biotech companies overall, but cheaper than the 17.7 of the S&P 500 healthcare sector.
However, Moderna is also trading at about 15 times estimates of its sales in five years - a valuation level that large biotech stocks with one key product have peaked at historically, according to Hartaj Singh, a biotech analyst at Oppenheimer.
Singh downgraded his rating on the stock to “neutral” in August.
“I don’t expect the stock to go down unless there is some unequivocal bad news that comes across,” Singh said.
“But I do think that a lot of the good news is already in the stock valuation.”
Reporting by Lewis Krauskopf; Editing by Ira Iosebashvili and Bill Berkrot
https://www.reuters.com/article/us-usa- ... SKBN2GD1OB
"Analysis-Torrid Moderna stock rally cools over booster shot doubts"
By Lewis Krauskopf
SEPTEMBER 17, 2021
NEW YORK (Reuters) - Debate over the need for COVID-19 booster shots is clouding the outlook for Moderna Inc’s high-flying shares after the U.S. biotechnology company’s stock price soared as much as 360% this year, making it the best performer in the S&P 500.
A panel of expert outside advisers to the U.S. Food and Drug Administration on Friday voted to recommend here COVID-19 vaccine booster shots for Americans 65 and older and those at high risk of severe illness, but rejected a request for broader approval.
The application for boosters for all Americans age 16 and older had been brought by Pfizer Inc for the vaccine it developed with German partner BioNTech SE.
Moderna, whose vaccine is based on a similar messenger RNA (mRNA) technology, applied earlier this month here to allow use of a booster dose.
Moderna has benefited from being one of the dominant coronavirus vaccines, but its shares have pulled back 11% since hitting a closing high of $484.47 in early August.
One factor in the rally stalling, analysts said, is a muddier outlook for additional booster COVID-19 shots, on top of the initial two-dose regimen.
“When (the stocks) ran up, I think it was expecting a booster shot to be given to everyone,” said Jeff Jonas, a portfolio manager at Gabelli Funds.
“Now I think it’s maybe a little less certain that that extra demand is going to be there.”
The U.S. government had said it plans to start offering booster shots here widely as soon as next week.
But experts have questioned whether there is evidence to back such a plan.
This week, leading scientists, including two departing U.S. Food and Drug Administration officials, said in an influential medical journal that additional booster shots are not needed here for the general population.
In a note earlier this week, SVB Leerink analysts estimated that the booster market is likely to add another $3 billion to $4 billion in U.S. revenue potential for existing vaccines.
Substantial booster revenue for the companies “are already contemplated in consensus estimates,” the Leerink analysts said, “making the stock impact for Moderna in particular dependent on the breadth of the recommended population and boosting interval.”
An already powerful rally in Moderna shares went into overdrive this summer, as index fund managers were forced to buy the stock after it was added to the S&P 500, and as concerns rose over a resurgence in COVID-19 cases due to spread of the virulent Delta variant of the virus.
The stock has been volatile since joining the index in mid July, with Moderna shares being either the biggest daily percentage gainer or loser in the S&P 500 in 10 trading days since the stock joined - a quarter of all the sessions over that time.
Analysts overall appear to be cautious about the stock, even as the company is developing other products, including a vaccine that combines a booster dose against COVID-19 with its experimental flu shot here.
The median price target for Moderna shares among 12 analysts is $391, according to Refinitiv, over 11% below Thursday’s closing price of $440.65.
Using earnings estimates for the next 12 months, Moderna shares trade at a price-to-earnings ratio of 15.8, according to Refinitiv Datastream.
That is more expensive than the 11.4 times P/E of S&P 500 biotech companies overall, but cheaper than the 17.7 of the S&P 500 healthcare sector.
However, Moderna is also trading at about 15 times estimates of its sales in five years - a valuation level that large biotech stocks with one key product have peaked at historically, according to Hartaj Singh, a biotech analyst at Oppenheimer.
Singh downgraded his rating on the stock to “neutral” in August.
“I don’t expect the stock to go down unless there is some unequivocal bad news that comes across,” Singh said.
“But I do think that a lot of the good news is already in the stock valuation.”
Reporting by Lewis Krauskopf; Editing by Ira Iosebashvili and Bill Berkrot
https://www.reuters.com/article/us-usa- ... SKBN2GD1OB
Re: THE ECONOMY
CNBC
"After years of being ‘squeaky clean,’ the Federal Reserve is surrounded by controversy"
Jeff Cox @JEFF.COX.7528 @JEFFCOXCNBCCOM
PUBLISHED FRI, SEP 17 2021
KEY POINTS
* The Federal Reserve has a big meeting on tap next week, one that will be held under the cloud of an ethical dilemma.
* Reports in recent days indicate that Fed officials have been trading stocks and bonds that could be influenced at least indirectly by their decisions.
* The Fed lives on its credibility, and some of the recent problems could dent that.
The Federal Reserve has a big meeting on tap next week, one that will be held under the cloud of an ethical dilemma and a policymaking committee that finds itself with fairly pronounced divisions about the path ahead.
Markets largely expect the Fed to follow the two-day session with no major decisions, but rather just the first but significant nods that the historically easy-money pandemic-era accommodation is coming to an end soon if slowly.
“Tapering” will be the word of the day when the post-meeting statement is issued Wednesday, at which time individual officials also will release their forecasts on the future arc of interest rates as well as economic growth and inflation.
All of that will be set against a backdrop of controversy: News reports in recent days indicate that Fed officials have been trading stocks and bonds that could be influenced at least indirectly by their policy decisions.
At the same time, speeches over the past several weeks indicate a schism between those who say the time is now to start tightening policy and those who’d rather wait.
For the normally staid Fed, the present circumstances are unusual and could yield some interesting dynamics.
“I think it’s embarrassing for the Fed."
"It had such a squeaky-clean reputation,” Greg Valliere, chief U.S. policy strategist at AGF Investments, said of the trading controversy that largely involved regional presidents Robert Kaplan of Dallas and Eric Rosengren of Boston.
“But I don’t think it’s going to change policy in any regard at all."
"I think it will be rearview mirror pretty soon, assuming there’s no other shoe to drop.”
Valliere did note that the issue will help fuel Fed critics such as Sen. Elizabeth Warren, D-Mass., who had been a vocal critic of the Fed’s looser regulatory approach in the years since the 2008-09 financial crisis.
A matter of credibility
More than that, though, the Fed lives on its credibility, and some of the recent problems could dent that.
There’s the market credibility issue – Wall Street and investors need to believe that the Fed is at least mostly unified in its monetary policy approach to setting interest rates and associated moves that have market impact.
Then there’s the public credibility – at a time when faith in Washington’s institutions has plunged, ethical missteps only add to that and can have repercussions, especially at such a delicate time.
“The ethics here look bad."
"They should have known better,” said Joseph LaVorgna, chief economist for the Americas at Natixis and former chief economist of the National Economic Council during the Trump administration.
“Once you lose that moral authority, it’s a problem.”
Rosengren, Kaplan and any other Fed officials who traded stocks didn’t violate any laws or policies.
In fact, that’s become part of the criticism leveled in some circles – that following the financial crisis the Fed didn’t do a housecleaning when it came to internal rules to make sure it avoided the kinds of conflicts that came to light during the financial crisis.
“Keep in mind, they already have [trading] rules they imposed on banks, for example, and yet the Fed’s governors don’t live by those same rules,” said Christopher Whalen, a Fed veteran and now chairman of Whalen Global Advisors.
“After Dodd-Frank [the post-crisis banking reforms], every agency in Washington tightened up little conflicts like insider trading."
"And yet the Fed is somehow exempt from those rules?"
"They look ridiculous.”
For its part, the Fed has noted that it is following rules for other government agencies and has supplemental rules as well.
Still, a spokesman for the central bank said Thursday that Chairman Jerome Powell has directed Fed staff “to take a fresh and comprehensive look at the ethics rules around permissible financial holdings and activities by senior Fed officials,” a spokesman said.
“This review will assist in identifying ways to further tighten those rules and standards."
"The Board will make changes, as appropriate, and any changes will be added to the Reserve Bank Code of Conduct,” the official added.
The controversy comes against a delicate backdrop for the Fed.
The central bank is preparing to take its first steps to normalize policy again, after slashing benchmark interest rates to zero and doubling the size of its balance sheet through more than $4 trillion in bond purchases.
Fed officials are divided on policy: By Goldman Sachs’ count, six officials who have spoken publicly on the issue of tapering asset purchases are for it and six are against.
On inflation, while Powell has said he expects price pressures to recede fairly soon, at least six Fed officials, including Governor Christopher Waller, have said they expect inflation to remain above the central bank’s 2% target beyond 2021.
One more complication thrown into the mix is that Powell’s term is set to expire in February, and President Joe Biden is expected to announce soon his preferred choice to lead the bank ahead.
Most on Wall Street expect Powell to be nominated again, but there’s growing sentiment that Biden will move out Randal Quarles as vice chairman in charge of bank supervision and replace him with Governor Lael Brainard, who likely would use a heavier hand in bank regulation.
Amid all those pressures, Powell will have to make sure the Fed gets policy right and is able to clear away some of the contentiousness of late.
“It’s not a fait accompli that Jerome Powell is reappointed,” said LaVorgna, the Natixis economist.
“The administration is understandably going to wait and see how the Fed handles the taper and what the markets do."
"That could be the determining factor in whether he’s reappointed.”
https://www.cnbc.com/2021/09/17/after-y ... versy.html
"After years of being ‘squeaky clean,’ the Federal Reserve is surrounded by controversy"
Jeff Cox @JEFF.COX.7528 @JEFFCOXCNBCCOM
PUBLISHED FRI, SEP 17 2021
KEY POINTS
* The Federal Reserve has a big meeting on tap next week, one that will be held under the cloud of an ethical dilemma.
* Reports in recent days indicate that Fed officials have been trading stocks and bonds that could be influenced at least indirectly by their decisions.
* The Fed lives on its credibility, and some of the recent problems could dent that.
The Federal Reserve has a big meeting on tap next week, one that will be held under the cloud of an ethical dilemma and a policymaking committee that finds itself with fairly pronounced divisions about the path ahead.
Markets largely expect the Fed to follow the two-day session with no major decisions, but rather just the first but significant nods that the historically easy-money pandemic-era accommodation is coming to an end soon if slowly.
“Tapering” will be the word of the day when the post-meeting statement is issued Wednesday, at which time individual officials also will release their forecasts on the future arc of interest rates as well as economic growth and inflation.
All of that will be set against a backdrop of controversy: News reports in recent days indicate that Fed officials have been trading stocks and bonds that could be influenced at least indirectly by their policy decisions.
At the same time, speeches over the past several weeks indicate a schism between those who say the time is now to start tightening policy and those who’d rather wait.
For the normally staid Fed, the present circumstances are unusual and could yield some interesting dynamics.
“I think it’s embarrassing for the Fed."
"It had such a squeaky-clean reputation,” Greg Valliere, chief U.S. policy strategist at AGF Investments, said of the trading controversy that largely involved regional presidents Robert Kaplan of Dallas and Eric Rosengren of Boston.
“But I don’t think it’s going to change policy in any regard at all."
"I think it will be rearview mirror pretty soon, assuming there’s no other shoe to drop.”
Valliere did note that the issue will help fuel Fed critics such as Sen. Elizabeth Warren, D-Mass., who had been a vocal critic of the Fed’s looser regulatory approach in the years since the 2008-09 financial crisis.
A matter of credibility
More than that, though, the Fed lives on its credibility, and some of the recent problems could dent that.
There’s the market credibility issue – Wall Street and investors need to believe that the Fed is at least mostly unified in its monetary policy approach to setting interest rates and associated moves that have market impact.
Then there’s the public credibility – at a time when faith in Washington’s institutions has plunged, ethical missteps only add to that and can have repercussions, especially at such a delicate time.
“The ethics here look bad."
"They should have known better,” said Joseph LaVorgna, chief economist for the Americas at Natixis and former chief economist of the National Economic Council during the Trump administration.
“Once you lose that moral authority, it’s a problem.”
Rosengren, Kaplan and any other Fed officials who traded stocks didn’t violate any laws or policies.
In fact, that’s become part of the criticism leveled in some circles – that following the financial crisis the Fed didn’t do a housecleaning when it came to internal rules to make sure it avoided the kinds of conflicts that came to light during the financial crisis.
“Keep in mind, they already have [trading] rules they imposed on banks, for example, and yet the Fed’s governors don’t live by those same rules,” said Christopher Whalen, a Fed veteran and now chairman of Whalen Global Advisors.
“After Dodd-Frank [the post-crisis banking reforms], every agency in Washington tightened up little conflicts like insider trading."
"And yet the Fed is somehow exempt from those rules?"
"They look ridiculous.”
For its part, the Fed has noted that it is following rules for other government agencies and has supplemental rules as well.
Still, a spokesman for the central bank said Thursday that Chairman Jerome Powell has directed Fed staff “to take a fresh and comprehensive look at the ethics rules around permissible financial holdings and activities by senior Fed officials,” a spokesman said.
“This review will assist in identifying ways to further tighten those rules and standards."
"The Board will make changes, as appropriate, and any changes will be added to the Reserve Bank Code of Conduct,” the official added.
The controversy comes against a delicate backdrop for the Fed.
The central bank is preparing to take its first steps to normalize policy again, after slashing benchmark interest rates to zero and doubling the size of its balance sheet through more than $4 trillion in bond purchases.
Fed officials are divided on policy: By Goldman Sachs’ count, six officials who have spoken publicly on the issue of tapering asset purchases are for it and six are against.
On inflation, while Powell has said he expects price pressures to recede fairly soon, at least six Fed officials, including Governor Christopher Waller, have said they expect inflation to remain above the central bank’s 2% target beyond 2021.
One more complication thrown into the mix is that Powell’s term is set to expire in February, and President Joe Biden is expected to announce soon his preferred choice to lead the bank ahead.
Most on Wall Street expect Powell to be nominated again, but there’s growing sentiment that Biden will move out Randal Quarles as vice chairman in charge of bank supervision and replace him with Governor Lael Brainard, who likely would use a heavier hand in bank regulation.
Amid all those pressures, Powell will have to make sure the Fed gets policy right and is able to clear away some of the contentiousness of late.
“It’s not a fait accompli that Jerome Powell is reappointed,” said LaVorgna, the Natixis economist.
“The administration is understandably going to wait and see how the Fed handles the taper and what the markets do."
"That could be the determining factor in whether he’s reappointed.”
https://www.cnbc.com/2021/09/17/after-y ... versy.html
Re: THE ECONOMY
CNBC
"Federal Reserve holds interest rates steady, says tapering of bond buying coming ‘soon’"
Jeff Cox @JEFF.COX.7528 @JEFFCOXCNBCCOM
PUBLISHED WED, SEP 22 2021
KEY POINTS
* The Fed kept benchmark interest rates anchored near zero.
* Officials indicated they expect to begin reducing monthly asset purchases “soon,” but did not say when.
* Economic projections pointed to slower overall growth this year but higher inflation than previously projected.
The Federal Reserve on Wednesday held benchmark interest rates near zero but indicated that rate hikes could be coming sooner than expected, and it significantly cut its economic outlook for this year.
Along with those largely expected moves, officials on the policymaking Federal Open Market Committee indicated they will start pulling back on some of the stimulus the central bank has been providing during the financial crisis.
There was no specific indication, though, as to when that might happen.
“If progress continues broadly as expected, the Committee judges that a moderation in the pace of asset purchases may soon be warranted,” the FOMC’s post-meeting statement said.
Respondents to a recent CNBC survey said they expect tapering of bond purchases to be announced in November and begin in December.
Fed Chairman Jerome Powell, at his post-meeting news conference, said the committee is ready to move.
“While no decisions were made, participants generally viewed that so long as the recovery remains on track, a gradual tapering process that concludes around the middle of next year is likely to be appropriate,” he said.
For now, the committee voted unanimously to keep short-term rates anchored near zero.
However, more members now see the first rate hike happening in 2022.
In June, when members last released their economic projections, a slight majority put that increase into 2023.
Powell said the Fed is getting closer to achieving its goals on “substantial further progress” on inflation and employment.
“For inflation, we appear to have achieved more than significant progress, substantial further progress."
"That part of the test is achieved in my view and the view of many others,” he said.
“My own view is the test for substantial further progress on employment is all but met,” Powell added.
Markets shaved some of their gains following the Fed news initially, with major stock averages still showing strong gains and government bond yields mixed.
There were some substantial changes in the Fed’s economic forecasts, with a decrease in the growth outlook and higher inflation expectations.
The committee now sees GDP rising just 5.9% this year, compared with a 7% forecast in June.
However, 2023 growth is now set at 3.8%, compared with 3.3% previously, and 2.5% in 2023, up one-tenth of a percentage point.
Projections also signaled that FOMC members see inflation stronger than projections in June.
Core inflation is projected to increase 3.7% this year, compared with the 3% forecast the last time members gave their expectations.
Officials then see inflation at 2.3% in 2022, compared with the previous projection of 2.1%, and 2.2% in 2023, one-tenth of a percentage point higher than the June forecast.
Including food and energy, officials expect inflation to run at 4.2% this year, up from 3.4% in June.
The subsequent two years are expected to fall back to 2.2%, little changed from the June outlook.
In another move, the Fed said it would double the level of repurchase of its daily market operations to $160 billion from $80 billion.
Markets had been expecting little in the way of major decisions from the meeting but have been on edge in part over when the Fed will begin reducing the pace of its monthly bond purchases.
Powell said during the Fed’s annual August symposium in Jackson Hole, Wyoming, that he and others were of the position that the central bank had met its inflation target and could start reducing the minimum $120 billion a month in buying of Treasurys and mortgage-backed securities.
Investors also were looking to the meeting to see where Fed officials stand on the inflation outlook.
The Fed’s preferred inflation measure — the personal consumption expenditures index less food and energy prices — accelerated by 3.6% in July, the highest level in 30 years.
However, Powell has said repeatedly that he expects price pressures to subside as supply chain factors, goods shortages and unusually high levels of demand return to pre-pandemic levels.
Projections for unemployment were a bit more pessimistic, with the end-year unemployment rate now at 4.8%, from the current 5.2% and the June estimate of 4.5%.
That comes on the heels of a disappointing August payrolls report that showed job growth of just 235,000.
However, Powell said it would not require blockbuster jobs numbers to get the Fed to begin removing policy accommodation.
“For me it wouldn’t take a knockout, great, super strong employment report."
"It would take a reasonably good employment report for me to feel like that test is met."
"Others on the committee, many on the committee, feel the test is already met."
"Others want to see more progress,” he said.
https://www.cnbc.com/2021/09/22/federal ... -soon.html
"Federal Reserve holds interest rates steady, says tapering of bond buying coming ‘soon’"
Jeff Cox @JEFF.COX.7528 @JEFFCOXCNBCCOM
PUBLISHED WED, SEP 22 2021
KEY POINTS
* The Fed kept benchmark interest rates anchored near zero.
* Officials indicated they expect to begin reducing monthly asset purchases “soon,” but did not say when.
* Economic projections pointed to slower overall growth this year but higher inflation than previously projected.
The Federal Reserve on Wednesday held benchmark interest rates near zero but indicated that rate hikes could be coming sooner than expected, and it significantly cut its economic outlook for this year.
Along with those largely expected moves, officials on the policymaking Federal Open Market Committee indicated they will start pulling back on some of the stimulus the central bank has been providing during the financial crisis.
There was no specific indication, though, as to when that might happen.
“If progress continues broadly as expected, the Committee judges that a moderation in the pace of asset purchases may soon be warranted,” the FOMC’s post-meeting statement said.
Respondents to a recent CNBC survey said they expect tapering of bond purchases to be announced in November and begin in December.
Fed Chairman Jerome Powell, at his post-meeting news conference, said the committee is ready to move.
“While no decisions were made, participants generally viewed that so long as the recovery remains on track, a gradual tapering process that concludes around the middle of next year is likely to be appropriate,” he said.
For now, the committee voted unanimously to keep short-term rates anchored near zero.
However, more members now see the first rate hike happening in 2022.
In June, when members last released their economic projections, a slight majority put that increase into 2023.
Powell said the Fed is getting closer to achieving its goals on “substantial further progress” on inflation and employment.
“For inflation, we appear to have achieved more than significant progress, substantial further progress."
"That part of the test is achieved in my view and the view of many others,” he said.
“My own view is the test for substantial further progress on employment is all but met,” Powell added.
Markets shaved some of their gains following the Fed news initially, with major stock averages still showing strong gains and government bond yields mixed.
There were some substantial changes in the Fed’s economic forecasts, with a decrease in the growth outlook and higher inflation expectations.
The committee now sees GDP rising just 5.9% this year, compared with a 7% forecast in June.
However, 2023 growth is now set at 3.8%, compared with 3.3% previously, and 2.5% in 2023, up one-tenth of a percentage point.
Projections also signaled that FOMC members see inflation stronger than projections in June.
Core inflation is projected to increase 3.7% this year, compared with the 3% forecast the last time members gave their expectations.
Officials then see inflation at 2.3% in 2022, compared with the previous projection of 2.1%, and 2.2% in 2023, one-tenth of a percentage point higher than the June forecast.
Including food and energy, officials expect inflation to run at 4.2% this year, up from 3.4% in June.
The subsequent two years are expected to fall back to 2.2%, little changed from the June outlook.
In another move, the Fed said it would double the level of repurchase of its daily market operations to $160 billion from $80 billion.
Markets had been expecting little in the way of major decisions from the meeting but have been on edge in part over when the Fed will begin reducing the pace of its monthly bond purchases.
Powell said during the Fed’s annual August symposium in Jackson Hole, Wyoming, that he and others were of the position that the central bank had met its inflation target and could start reducing the minimum $120 billion a month in buying of Treasurys and mortgage-backed securities.
Investors also were looking to the meeting to see where Fed officials stand on the inflation outlook.
The Fed’s preferred inflation measure — the personal consumption expenditures index less food and energy prices — accelerated by 3.6% in July, the highest level in 30 years.
However, Powell has said repeatedly that he expects price pressures to subside as supply chain factors, goods shortages and unusually high levels of demand return to pre-pandemic levels.
Projections for unemployment were a bit more pessimistic, with the end-year unemployment rate now at 4.8%, from the current 5.2% and the June estimate of 4.5%.
That comes on the heels of a disappointing August payrolls report that showed job growth of just 235,000.
However, Powell said it would not require blockbuster jobs numbers to get the Fed to begin removing policy accommodation.
“For me it wouldn’t take a knockout, great, super strong employment report."
"It would take a reasonably good employment report for me to feel like that test is met."
"Others on the committee, many on the committee, feel the test is already met."
"Others want to see more progress,” he said.
https://www.cnbc.com/2021/09/22/federal ... -soon.html
Re: THE ECONOMY
REUTERS
"Evergrande debt troubles seem particular to China -U.S. Fed's Powell"
By Reuters Staff
SEPTEMBER 22, 2021
(Reuters) -U.S. Federal Reserve Chair Jerome Powell said on Wednesday that the debt problems of property developer Evergrande seem particular to China and that he did not see a parallel with the U.S. corporate sector.
A potential default by Evergrande, Asia’s biggest junk-bond issuer, drove a steep selloff on Wall Street and widened spreads on U.S. high-yield bonds on Monday, although markets have steadied since then.
“In terms of the implications for us, there’s not a lot of direct United States exposure."
"The big Chinese banks are not tremendously exposed, but you would worry it would affect global financial conditions through global confidence channels and that kind of thing,” Powell told reporters after the Fed’s policy meeting.
“But I wouldn’t draw a parallel to the United States corporate sector.”
He added that with the onset of the coronavirus pandemic last year, the Fed was concerned about a wave of defaults by highly leveraged companies, noting that did not materialize to a significant extent because of the U.S. CARES Act and action by the central bank.
Currently, corporate default rates are “very, very low,” he said.
As for Evergrande, Powell said China has very high debt for an emerging market economy and that its government put new strictures in place for highly leveraged companies.
Evergrande on Wednesday said it agreed to settle interest payments on a domestic bond, while the Chinese central bank injected cash into the banking system, temporarily soothing investors’ fears of imminent contagion that had pressured equities and other riskier assets at the start of the week.
Reporting by Karen Pierog; Editing by Leslie Adler and Marguerita Choy
https://www.reuters.com/article/usa-fed ... SL1N2QO2K3
"Evergrande debt troubles seem particular to China -U.S. Fed's Powell"
By Reuters Staff
SEPTEMBER 22, 2021
(Reuters) -U.S. Federal Reserve Chair Jerome Powell said on Wednesday that the debt problems of property developer Evergrande seem particular to China and that he did not see a parallel with the U.S. corporate sector.
A potential default by Evergrande, Asia’s biggest junk-bond issuer, drove a steep selloff on Wall Street and widened spreads on U.S. high-yield bonds on Monday, although markets have steadied since then.
“In terms of the implications for us, there’s not a lot of direct United States exposure."
"The big Chinese banks are not tremendously exposed, but you would worry it would affect global financial conditions through global confidence channels and that kind of thing,” Powell told reporters after the Fed’s policy meeting.
“But I wouldn’t draw a parallel to the United States corporate sector.”
He added that with the onset of the coronavirus pandemic last year, the Fed was concerned about a wave of defaults by highly leveraged companies, noting that did not materialize to a significant extent because of the U.S. CARES Act and action by the central bank.
Currently, corporate default rates are “very, very low,” he said.
As for Evergrande, Powell said China has very high debt for an emerging market economy and that its government put new strictures in place for highly leveraged companies.
Evergrande on Wednesday said it agreed to settle interest payments on a domestic bond, while the Chinese central bank injected cash into the banking system, temporarily soothing investors’ fears of imminent contagion that had pressured equities and other riskier assets at the start of the week.
Reporting by Karen Pierog; Editing by Leslie Adler and Marguerita Choy
https://www.reuters.com/article/usa-fed ... SL1N2QO2K3