Matthew Luzzetti

After shrugging off a historic plunge in April employment, market participants will likely need to digest further record-setting monthly declines in core CPI inflation as well as April retail sales and industrial production. However, with financial markets seemingly numb to the bad data news, Fed Chair Powell's appearance on Wednesday may overshadow what is likely to be epic weakness in this week's economic data. [more]

After shrugging off a historic plunge in April employment, market participants will likely need to digest further record-setting monthly declines in core CPI inflation as well as April retail sales and industrial production. However, with financial markets seemingly numb to the bad data news, Fed Chair Powell's appearance on Wednesday may overshadow what is likely to be epic weakness in this week's economic data. Matthew Luzzetti, Chief US Economist shares his insights. [more]

It is now evident that the US economy is in the midst of the most severe contraction in the post-World War II era, one which could produce a record quarterly contraction in output in the second quarter and an unemployment rate above 17% in April. The path beyond the Q2 contraction is, however, remarkably uncertain. Matthew Luzzetti, Chief Economist, US explains. [more]

It is now evident that the US economy is in the midst of the most severe contraction in the post-World War II era, one which could produce a record quarterly contraction in output in the second quarter and an unemployment rate above 17% in April. The path beyond the Q2 contraction is, however, remarkably uncertain. [more]

The US economy is experiencing unprecedented disruptions that have led to a sudden stop in activity. The result will be the most dramatic decline in GDP and sharpest rise in unemployment in the post-World War II period. Matthew Luzzetti, Chief US Economist shares his insights. [more]

The US economy is experiencing unprecedented disruptions that have led to a sudden stop in activity. The result will be the most dramatic decline in GDP and sharpest rise in unemployment in the post-World War II period. [more]

Covid-19 is quickly becoming a global pandemic. Outbreaks in Italy, Korea, and Iran appear to be spreading rapidly, with more than 60 countries having been directly affected and cases being reported in New York City and many other key cities around the world. [more]

Chief US Economist Matthew Luzzetti recently shared insights on the current global interest rate environment and the challenge that low inflation plays in efforts to support the economy when needed. [more]

Chief US Economist Matthew Luzzetti shares insights on the current global interest rate environment and the challenge that low inflation plays in efforts to support the economy when needed. [more]

Robust, broad-based global expansion. Synchronised growth across regions and economies, in many cases at above-trend levels. We expect global growth to accelerate to +3.9% this year, marginally above 2017, as fundamentals remain supportive. We expect the US and eurozone to continue growing above potential, but do not anticipate any further acceleration. In China, we expect growth to slow, and are more worried about inflation and financial risks than consensus. 2018 should mark the peak of the current cyclical expansion; growth should decelerate from 2019. [more]

Inflation data over the past year – and especially over the past week – have highlighted a critical point. Fluctuations in inflation rates for items that are typically insensitive to the busi-ness cycle — which we refer to as acyclical, such as health care and apparel — can drive the overall inflation trajectory and lead to regime shifts in the market’s inflation narrative. The plunge in wireless telephone services prices last March, followed by a string of downside surprises to other acyclical items, spawned a narrative that structural disinflationary forces would prevent inflation from rising. In the same way, recent stronger inflation data led by acyclical items may have revived the narrative that the Phillips curve is, in fact, alive and well and that risks are tilted toward inflation overshooting the Fed’s target. [more]

After a stellar 2017 and an even stronger January, risk assets have undergone a sharp pullback in the last week. Initially triggered by higher rates as markets repriced inflation expectations higher, the episode evolved into a technical spout of volatility exacerbated by programmatic strategies. The pullback is healthy, after a highly unusual stretch of market tranquility. [more]