Samuel Tombs

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Samuel Tombs

Samuel Tombs

@samueltombs

Chief US Economist at Pantheon Macroeconomics.

London Katılım Nisan 2009
1.5K Takip Edilen13.4K Takipçiler
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Samuel Tombs
Samuel Tombs@samueltombs·
Thrilled to formally become Chief US Economist at Pantheon Macro today. @IanShepherdson has been an incredible mentor since I switched focus from the UK in Feb. I look forward to maintaining Pantheon’s reputation for incisive research on the US economy, supported by Oliver Allen.
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Samuel Tombs
Samuel Tombs@samueltombs·
Both the Indeed and LinkUp measures of US job openings have dropped by just over 1% from their end-Feb levels. Possibly a sign that the Iran war is already instilling a more cautious approach to hiring in some sectors.
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Samuel Tombs
Samuel Tombs@samueltombs·
We're tracking a 0.43% rise in the core PCE deflator in February with both PPI and CPI now in hand. The main culprit for the large rise is CPI computer software prices which will add 8bp alone (it has a much bigger weight in the deflator than in the CPI).
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Samuel Tombs
Samuel Tombs@samueltombs·
The silver lining to the otherwise bad US PPI data is that retailers now appear to have passed on all the tariff costs to consumers. Trade services prices have rebounded over last three months and now are back to their trend path:
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Samuel Tombs
Samuel Tombs@samueltombs·
The US consumer looks weaker after downward revisions to Q4 spending and the muted 0.1% m/m rise in January. The slowdown in real income growth is finally exerting its gravitational pull, and the energy price shock now in motion will add to the headwinds in Q2.
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Samuel Tombs
Samuel Tombs@samueltombs·
The standout stat in the JOLTS report is the sharp drop in job openings in the professional and business services sector, to the lowest level since April 2020. This hints at an intensifying AI headwind to the labor market, given that this sector has adopted it relatively quickly.
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Samuel Tombs
Samuel Tombs@samueltombs·
@NickTimiraos @fcastofthemonth It's looking very likely the PCE-CPI wedge widened, given the 6.5% jump in computer software prices. This component has only a 0.3% weight in the core CPI, but a much bigger 1.2% weight in the core PCE deflator. It alone will contribute 0.08pp to the m/m% change in the core PCE.
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Nick Timiraos
Nick Timiraos@NickTimiraos·
And a third would be that core PCE is running much firmer than CPI for reasons discussed at length in this story wsj.com/economy/centra… And early reads from the people who know (@fcastofthemonth) say that this wedge may have widened again in Feb.
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Nick Timiraos
Nick Timiraos@NickTimiraos·
Two asterisks to what would normally be considered a fairly decent CPI report. First, obviously, this was before the economic fallout from the Iran war. Second, the very favorable data imputation in the October report (due to the govt shutdown) unwinds after March.
Nick Timiraos@NickTimiraos

The core CPI rose 0.22% in Feb, in line with expectations. That lowered the 12-month rate to 2.46%. Core inflation was 2.3% annualized over the previous six months. Both are the lowest readings in five years. 3% annualized over the last 3 months, the highest since Sept

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Samuel Tombs
Samuel Tombs@samueltombs·
This CPI report has a sting in its tail. The components which feed into the PCE deflator calculation were collectively hot (the 6.5% jump in computer software prices will boost the core PCE deflator by 0.08pp alone). Looks like another 0.4% rise in Feb, bar a big PPI surprise.
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Samuel Tombs
Samuel Tombs@samueltombs·
An extremely low response rate to the payroll survey in February. Implies more scope than usual for late returns to alter the picture. But nearly always those late responses lead to downward revisions.
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Samuel Tombs
Samuel Tombs@samueltombs·
No silver lining to this jobs report. Yes, payrolls were hit by a 31K jump in strikes and a birth-death model which was 36K less generous than last Feb. But even excluding these factors, payrolls would have fallen (25K rather than 92K) and we know revisions worsen the picture
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Samuel Tombs
Samuel Tombs@samueltombs·
@TheStalwart @asokol_econ @stuartapaul NFIB hiring intentions down sharply in February though, back to last year's lows (data released earlier today). Has been among the best leading indicators of payrolls over last four years.
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Joe Weisenthal
Joe Weisenthal@TheStalwart·
This is very interesting from @asokol_econ and @stuartapaul of Bloomberg Economics. If you combine a bunch of different alt data sources that track the labor market, there's been clear, ongoing improvement since September.
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Samuel Tombs
Samuel Tombs@samueltombs·
The above-consensus rise in the US PPI was mostly due to a rebound in trade services prices. In a positive light, this suggests that retailers' margins are now back to normal, tariff-related price rises are now over, and therefore CPI core goods inflation will slow from here.
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Samuel Tombs retweetledi
Oliver Allen
Oliver Allen@ollyallenecon·
Q4 GDP growth still was solid underneath the shutdown-linked hit to government spending. But the economy now looks very reliant on the AI boom. The contribution to GDP growth from computer and software capex shot above its dot com boom peak last quarter.
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Samuel Tombs
Samuel Tombs@samueltombs·
US households' real aftertax income stagnated in Q3 and Q4, so all the growth in spending was due to lower saving. The saving rate has been this low before only during credit booms and after periods of excess saving. With neither support in play now, the rate will climb this year
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Samuel Tombs
Samuel Tombs@samueltombs·
We provisionally estimate January's CPI data point to a 0.23% rise in the core PCE deflator and a drop in the inflation rate to 2.9%, from 3.0% in December. But we're still awaiting Dec's PCE print and Jan's PPI data, so things could change.
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Samuel Tombs
Samuel Tombs@samueltombs·
A good CPI report in the round. Core goods prices ex-used autos up most for 3 years, but driven by one-time hikes in tobacco and Spotify's prices, not tariffs. Services price rises smaller than last yr, outside health & airfares. Path still clear for Fed to ease again this summer
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Samuel Tombs
Samuel Tombs@samueltombs·
Claims in NY state likely were elevated last week due to the snowstorms, but they have been tending to exceed their year-ago levels for several weeks now. One to watch.
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Samuel Tombs
Samuel Tombs@samueltombs·
Payrolls rose at an above-trend pace due to mild weather in early January and an erratic-looking jump in healthcare jobs. It's premature to conclude the labor market has turned a corner given the absence of a shift in reliable survey indicators of labor demand.
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Samuel Tombs
Samuel Tombs@samueltombs·
Two-thirds of the big drop in the JOLTS measure of job openings in December was driven by the professional and business services sector. It sure looks like AI is driving the labor market down:
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Samuel Tombs
Samuel Tombs@samueltombs·
Historically, the shortest time between the President's announcement and the Senate's confirmation of a Fed Chair has been 82 days. Simultaneously retaining the confidence of the President, markets and nearly all Republican Senators over next 3m will be no easy task for Warsh.
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