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Daily Economic Commentary

A collection of articles from Nationwide experts and guest authors about current events impacting the economy and financial markets.

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Daily Economic Commentary

Powell injects a note of caution

Federal Reserve Chairman Jerome Powell said explicitly in his semiannual congressional testimony that he supports a 25 basis point rate hike at the FOMC meeting in two weeks and expects that “a series” of further increases will be necessary over the remainder of the year. He again stressed the robustness in the labor market and repeated that the Fed would tighten more aggressively should inflation fail to dissipate as expected. 

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Daily Economic Commentary

Jobless claims are plummeting

New claims for unemployment insurance continued to fall sharply last week, moving lower by 38,000 to 406,000. This is the sixth decline in the last seven weeks and it leaves the series on track for its most rapid annual drop on record. Roughly one year into this cycle, initial claims are now also remarkably below their level from this same point in the 2009-20 expansion despite having peaked at more than nine times higher in the preceding recession. 

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Daily Economic Commentary

Volatility endemic to high-flying markets

It has been a tough run for the euphoria trade of late. Bitcoin was off by more than 50 percent from its mid-April high at one point over the weekend, with many other cryptocurrencies following suit, while NFT sales volumes have similarly plunged from their peak in early March. There have even been some ripples in the red-hot market for physical collectibles; a LeBron James rookie card, for example, sold this week at a nearly 60 percent discount to its price of just two and a half months ago. 

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Daily Economic Commentary

Perceptions of job availability soar

The Conference Board's consumer confidence index was largely unchanged in May at 117.2, as the present situation component moved higher while expectations fell. The inflation outlook ticked up and buying plans were broadly lower, but, in another sign of COVID's fading impact on activity, more respondents characterized business conditions as "normal" than at any time in the last dozen years. 

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Daily Economic Commentary

Well-being disparities likely to influence Fed policy

The Federal Reserve's latest report on economic well-being shows both the effectiveness of stimulus in offsetting last year's COVID-driven recession and the bifurcating effects of the pandemic itself. Three-quarters of the respondents indicated that they were "at least doing okay" financially last year, in line with the reading for 2019 and tied for the highest mark in the short history of the series. Along these same lines, a record 64 percent of respondents indicated that they could cover an unexpected $400 expense using cash, savings, or a credit card paid off at the next statement. This metric has risen in every year since the survey debuted in 2013, when only 50 percent of adults indicated that they could cover such an emergency.