Latest news with #PhillyFed
Business Mayor
16-05-2025
- Business
- Business Mayor
Crypto Bulls Just Got Their Macro Wake-Up Call: Here's Why
Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and publishing Strict editorial policy that focuses on accuracy, relevance, and impartiality Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio. An unprecedented surge in the Philadelphia Federal Reserve's May Manufacturing Business Outlook Survey has jolted global risk markets and given crypto asset traders their clearest macro catalyst of the year. The Future New Orders diffusion index leapt by forty-plus points, a move that Julien Bittel, head of macro research at Global Macro Investor (GMI), called 'literally' historic. Crypto Bulls Can Rejoice Bittel's commentary on X framed the print with statistical precision: 'Philly Fed data for May dropped yesterday – and the Future New Orders index just made history. Literally. … Expectations for new orders posted the largest monthly spike ever recorded – going all the way back to the index's inception in May 1968. A staggering +4.3 standard deviation move. He underlined the shock with a comparison few macro watchers will forget: For perspective: that's an even bigger move up than the downside collapse during the depths of the 2008 Global Financial Crisis (-4.1σ). Let that sink in…' Philly Fed Future New Orders | Source: X @BittelJulien Bittel then set the surge in a broader narrative that has animated his research since late last year. 'Q1 growth was weak. The reason is straightforward – financial conditions tightened sharply in Q4. The dollar ripped, bond yields surged… a classic tightening phase,' he wrote. Related Reading The proximate trigger, in his telling, was 'businesses panic‑loading inventories ahead of Trump tariffs, and markets front‑running the inflation narrative.' Those dynamics, he argued, are a replay of Donald Trump's first term: 'We've highlighted repeatedly: this had all the hallmarks of Q4 2016 during Trump's first term. Just like early 2017, that tightening spilled over into slower growth momentum in Q1.' Where 2017 began with doubt and ended in a synchronous global boom, Bittel believes 2025 is rhyming. 'Those Q1 headwinds have flipped into Q2 tailwinds,' he insisted. 'Everything flows downstream from changes in financial conditions… Purchasing managers' expectations are shifting – and shifts in thinking eventually translate into action. Sentiment shifts first. Action follows. It always does. Bullish.' The crypto market responded muted. Bitcoin reclaimed the $104,000 level in early‑European trade, but lost it later on. Ether steadied near $2,600, and high‑beta layer‑one tokens such as Solana and Avalanche moved in tandem. Related Reading Giancarlo Cudrig, head of markets at Immutable, said the scale of the shock is less important than how under‑positioned investors are for an upside growth surprise. 'An upside economic shock like this – +4.3σ on new orders – is rare. But the bigger story is market positioning. Asset prices are not prepared. The melt‑up is the asymmetric risk. Now it's being repriced.' Independent analyst Market Heretic struck a similar note on X: 'When this dropped, markets didn't even blink. Because the shift's already in motion. This wasn't news, it was confirmation. That's the real tell, when markets shrug off a four‑sigma upside shock. It means the turn is already upon us – and it's just getting started.' Read More Whales Hoard $90 Million In Bitcoin: A Sign Of What's To Come? For crypto investors, the implications are immediate. A softer dollar and retreating real‑yield expectations reduce the opportunity cost of holding non‑yielding assets, while the early phase of a reflationary turn historically favours high‑beta exposures. Bittel's own playbook is unambiguous: 'Sentiment shifts first. Action follows.' As long as that chain reaction continues, the crypto bulls appear to have both math and momentum on their side. At press time, the total crypto market cap stood at $3.28 trillion. Total market cap, 1-week chart | Source: TOTAL on Featured image created with DALL.E, chart from
Yahoo
30-04-2025
- Business
- Yahoo
A record number of Americans are only making their minimum credit card payment
Over 11% of Americans with accounts at the country's largest banks only made the minimum payment on their credit card bill in the fourth quarter of 2024, a record since the Federal Reserve Bank of Philadelphia began tracking the number 12 years ago. Lower-income consumers have been under increasing pressure since inflation surged to four-decade highs following the pandemic, and price hikes from tariffs will further strain budgets. Credit card data shows consumers are under increasing pressure, just as President Donald Trump's tariffs are poised to significantly raise costs on everyday consumers. Over 11% of Americans with accounts at the country's largest banks only made the minimum payment on their credit card bills in the fourth quarter of 2024, a record since the Federal Reserve Bank of Philadelphia began tracking the number 12 years ago. The Philly Fed's data, published earlier this month, was highlighted over the weekend by Torsten Sløk, chief economist at private equity giant Apollo. A report from the firm coauthored by Sløk said trade disruptions, particularly between the U.S. and China, could cause a full-on recession by the summer. A growing number of consumers are already vulnerable as delinquency rates rise: The share of credit card accounts 90 days past due also set a record. 'Collectively, these trends, along with a new series high for revolving card balances, indicate greater consumer stress,' Philly Fed analysts Jeremy Cohn and Brandon Goldstein wrote. View this interactive chart on Jay Hatfield, the CEO of Infrastructure Capital Advisors, believes a downturn is imminent if the Fed does not cut interest rates. Along with boosting overall economic activity, that would make it easier for people to pay off their credit card debt. 'So you're seeing kind of the normal rotation,' he told Fortune. 'Investment spending drops. Labor market weakens up. Consumers spend less.' Still, people likely won't cut back astronomically, he said, even in a recession. After all, if more Americans are struggling to pay off their entire balance, it means they are still buying. 'Usually what we say is that consumers consume just like woodchucks chuck wood,' said Hatfield, who manages ETFs and a series of hedge funds. 'What we mean by that is that they're extremely resilient,' he added. 'The low end has to spend money, and the high end wants to spend money and can spend money.' To be sure, seasonal changes are part of the story: Credit card debt levels always rise amid holiday shopping. The data does emphasize, however, how economic developments over the last half decade have impacted high earners and lower-income individuals much differently. One example is credit access. The Philly Fed found firms have increased card limits for borrowers who qualify for larger credit lines. The 90th percentile of credit limits grew 5.4% year-over-year, the third-largest annual increase over the last 12 years. For the 50th percentile, however, card limits stayed level at an average of $5,000, a contraction in real terms due to inflation. A similar trend has played out with mortgages, with the 90th percentile of loans on bank balance sheets growing twice as fast as the median since the final quarter of 2019. For wealthy people, Hatfield said, post-pandemic inflation boosted home values and was easily outpaced by investment gains from a booming stock market. Lower-income consumers, however, have been forced to weather a significant increase in the cost of living as interest rates remain elevated. 'A huge part of society, they didn't benefit from that inflation,' Hatfield said. 'They got hammered by it.' Discontent over this situation has been widely credited for helping Trump land a second stint in the Oval Office. His fixation on using tariffs to reorient global trade and raise a growing share of America's revenues, however, may ultimately not sit well with people most exposed to higher prices. The Yale Budget Lab estimates Trump's announced tariffs, as of April 15, will cost the average household $4,900 in last year's dollars. Tariffs are a type of 'regressive tax,' which take a bigger chunk out of the budget from poorer households than from wealthier consumers who pay the same rate. 'It is going to put further pressure on low-income consumers, put the U.S. economy further at risk, and could eventually lead to a recession,' Hatfield said. On Sunday, Trump suggested tariff income could replace income taxes on households making less than $200,000 a year. Economists and tax-policy experts, including at the center-right Tax Foundation, have said that would be impossible. The White House did not respond to Fortune's request for comment. The chaotic rollout of tariffs has caused consumer sentiment to drop by more in three months than at any point since 1990, including the 2008 financial crisis. Year-end inflation expectations, meanwhile, came in highest since 1981, when price increases were just beginning to retreat after a ruinous spike. Executives from the likes of Southwest Airlines, Chipotle, and PepsiCo, meanwhile, have warned their businesses are already feeling the effects of people cutting back. After all, a growing number of consumers are struggling to pay off their credit card bills. Correction: This story was updated to clarify that the 90th percentile of credit card limits grew 5.4% year-over-year. This story was originally featured on
The Hill
11-04-2025
- Business
- The Hill
Will Trump's tariffs affect U.S. jobs?
On again, off again: the spectre of the potential economic fallout of tariffs has worried Americans since President Trump's inaugural address, when he proposed to 'tariff and tax foreign countries to enrich our citizens'. Global tariffs were announced, amended or rescinded across February and March, with a number going into effect, for example, new tariffs on all steel and aluminum imports went into effect mid-March. Most recently, the President has rowed back on a package of steep tariffs he intended to levy on dozens of the country's trading partners. 5 jobs hiring across the U.S. On April 9th, he said that nearly all of his reciprocal tariffs would be paused for 90 days. Additionally, he announced that he may consider exempting some U.S. companies altogether. That was welcome news, but regardless, the period of uncertainty that has been fostered by tariff announcements has sent shockwaves through the U.S. and wider global economies. Tariff announcements triggered the worst two-day loss in United States stock market history. Over one two-day period alone, $6.6 trillion in value was wiped out. Additionally, the S&P 500, an index tracking the performance of the largest publicly-traded companies in the U.S, suffered its biggest loss since its creation in the 1950s. Reuters says that it has been 'the most intense episode of financial market volatility since the early days of the COVID-19 pandemic.' Even as April 9th's reversal brought sighs of relief, and lacklustre markets quickly rallied, fears of a recession, and job losses are still top of mind. Job fears growing LinkedIn news says worker confidence is lower than it was in spring of 2020, while data from the Philly Fed 's January 2025 Labor, Income, Finances, and Expectations (LIFE) Survey shows that 30 percent of workers said they were concerned about their employer's ability to stay in business. Younger and older workers are more likely to be concerned. Employees aged 18 to 35, and those aged 56 to 65 are more worried about losing their jobs. The most recent U.S. Bureau of Labor Statistics report was released at the start of April. It has some better news in that it indicates that total nonfarm payroll rose by 228,000 in March. However, economists say the picture doesn't look quite as positive when viewed up close. For one, healthcare and social assistance accounted for a large portion of total jobs; 34 percent of March's numbers. 'At the surface level, it seems like a stable and resilient labor market. However, a closer examination of the data reveals that employers are exercising caution across nearly all sectors,' says Ger Doyle, the U.S. country manager at ManpowerGroup. Cory Stahle, who is an economist at Indeed's Hiring Lab, also offered sobering analysis in a statement. 'The residual confidence and optimism that helped buoy the labor market through the first quarter reversed virtually overnight after this week's announcements, and there is likely no going back,' he said. 'The velocity with which these policy changes are now happening is so fast that many employers will find it challenging to find the stability needed to maintain business as usual.' Stahle also says that 'prime-age labor force participation rate and employment-population ratio both appear to have reached a ceiling, suggesting labor supply issues could soon become a challenge for the market.' Effects hitting home The fact is that the effects of tariffs don't fall equally on all households and demographics. A 2018 study by the U.S. The International Trade Commission found that tariffs disproportionately fall on both low-income groups and women. This is because less well-off consumers tend to spend a bigger portion of their income on necessary goods. As a result, tariffs act almost as an income tax on these cohorts. Women, too, may bear a disproportionate burden of the effects of tariffs. In particular, single-parent families are 90 percent more likely to be headed by females than males. These families also tend to spend about 40 percent of their income buying goods, which increases their exposure to the effects of tariffs. Period of uncertainty Uncertainty is not good for the labor market. It's likely that companies will bed-in until this period of fluctuation ends, and job creation will stall. Right now, Manpower's Ger Doyle notes that the labor market may be 'locked in place'. He also pointed out that while U.S. business and organizations are focused on preserving the status quo, this could all change. And that, he said, could put layoffs back on the agenda.
Yahoo
27-02-2025
- Business
- Yahoo
Steady Jobless Claims, Good Philly Fed, Healthy Q4 Earnings
Thursday, February 20, 2025We have an informative and far-reaching morning of investment data ahead of today's opening bell, with Weekly Jobless Claims and Philly Fed manufacturing joining some key quarterly earnings reports. Pre-market indexes are once again starting off lower than the previous-day's close, but the S&P 500 is working on a two-day record-closing-high Dow is currently -150 points at this hour, with the S&P 500 -17. The Nasdaq has dropped -50 points currently, and the small-cap Russell 2000 is -4 points. Bond yields remain steady but with a slight downward bias: the 10-year is currently at +4.511% and the 2-year is +4.257%. Initial Jobless Claims for last week came in slightly above estimates — 219K from 215K expected — and up from the slightly upwardly revised 214K from the prior week. Still, it's the third week of the last four sub-220K; this is not a terribly meaningful threshold, more just a round number. We had a one-week outlier at +260K new claims the first week in October of last Claims also stayed range-bound: 1.869 million, while notably ahead of where longer-term claims were a year ago (sub-1.8 million), is the fourth-straight week below 1.9 million. Again, this is not a key threshold — that would be 2 million longer-term jobless claims per month. We haven't been there since the first week of November 2021, and multitudes lower than the Covid-era layoff nightmare. The latest manufacturing survey for the sixth-largest city in the U.S. — the Philly Fed index — came in at +18.1 for the month of February this morning, above expectations for +13.2. This follows the strongest monthly headline in this metric, +44.3, which was the highest level we've seen since April of 2021. This index demonstrated the highest prices paid in two years. As we've seen elsewhere, this is bad news for the Fed lowering interest rates, but good for the economy at large. Walmart WMT posted Q4 earnings ahead of today's open, outpacing estimates on the bottom line by a penny — 66 cents per share versus 65 expected — on a truly breathtaking $180.55 billion in sales over the three-month period. However, guidance was for trimming sales expectations, as the company does not believe it will be immune from new tariff policy on imported goods from China. Shares were down -6% on the news. For more on WMT's earnings. click out the updated Zacks Earnings Calendar BABA shares, on the other hand, are up +12% this morning following fiscal Q3 earnings hitting the tape: earnings of $2.93 per ADS was shy of the $3.08 in the Zacks consensus, but revenues of $38.6 billion were ahead of the $38.2 billion projected. The bigger news here may be the shift in policy from China's leaders, signaling an end to the crackdown on major companies in Chinese tech, like TRIP saw another good quarter this morning, with Q4 earnings coming in at 30 cents per share as opposed to the expected 21 cents (though off the year-ago level of 38 cents per share a year ago). Revenues of $411 million outpaced estimates by +2.6%. TRIP shares have gained almost +20% year to date, but market participants are selling the news -2.5%. Will American travel keep up its lofty levels? That's the question. For more on TRIP's earnings, click here. Wayfair W, however, saw a big -1350% earnings miss for its Q4 bottom line this morning, posting -$0.02 per share versus projections for +$0.25. Revenues beat estimates by +1.73% to $3.12 billion in the quarter, and this turnaround in sales growth is generating interest in the stock, which is now up +8.5% in pre-market trading. For more on W's earnings, click or comments about this article and/or author? Click here>> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Walmart Inc. (WMT) : Free Stock Analysis Report TripAdvisor, Inc. (TRIP) : Free Stock Analysis Report Alibaba Group Holding Limited (BABA) : Free Stock Analysis Report Wayfair Inc. (W) : Free Stock Analysis Report To read this article on click here. Zacks Investment Research Sign in to access your portfolio
Bloomberg
26-02-2025
- Business
- Bloomberg
US Workers Cite Growing Layoff Fear in Philadelphia Fed Survey
Almost one-third of US workers are concerned about getting laid off by their employers, a share that's risen significantly over the past six months, according to a new Federal Reserve Bank of Philadelphia survey. Among younger and older cohorts — employees age 18 to 35 and those age 56 to 65 — concern about losing jobs was the highest in at least two years, the Philly Fed's January 2025 Labor, Income, Finances, and Expectations (LIFE) Survey published Wednesday shows. Some 30% of workers said they were concerned about their employer's ability to stay in business.
