Hikes Data Dependent Says NY Fed: So, Let’s Look At The Data

Economic Snapshot

Yesterday, Fed minutes show that Fed Chair Janet Yellen is on a mission to convince the market that a rate hike is on the table for June.

Today, New York Fed president William C. Dudley gave an Economic Press Briefing on the state of the U.S. economy.

Let’s take a look at the briefing and the data.

Dudley Comments

When asked about the trajectory for the monetary policy stance, I always point out that it is data dependent.

While market analysts readily have access to economic and financial data, this access is not widely available to everyone. To help fill this information gap, for the past year we have been making available on our website a monthly publication called U.S. Economy in a Snapshot. This publication contains a set of key data charts as well as commentary by our staff economists. The purpose is to provide interested readers easy access to clear and concise presentations of important economic information. The associated commentary provides some pertinent observations one might draw from the data.

Our goal is to provide information that helps households and businesses follow the data along with the Fed. If people know more about how the economy is performing and how that is likely to influence our actions, this should make it easier for us to achieve our twin objectives.

U.S. Economy in a Snapshot Overview

Real consumer spending was flat in March and its growth slowed further during the first quarter of 2016. However, April light-weight vehicle sales rebounded from a weak March reading and the April retail sales report was strong.

Business fixed investment declined for a second consecutive quarter, while there were tentative signs of stabilization in the manufacturing sector.

The general tone of the housing data in April suggests the sector remained on a very gradual uptrend.

Payroll growth slowed in April, and the unemployment rate was unchanged. The labor force participation rate and the employment-population ratio both declined. Wage growth remains subdued despite a relatively steady improvement in labor market conditions.

After some firming in previous months, inflation softened modestly in March, signaling continued slow progress toward the FOMC’s longer-term objective. Financial asset price fluctuations generally were fairly subdued. The yen appreciated after the Bank of Japan decided on April 28 to leave its policy stance unchanged.