After second-quarter growth undershot at an annualised 1.5 percent, attention has moved to markets, where Bloomberg reports equity traders bracing for wild swings and the FT says long bonds have been spooked by Warsh's silence.
The Commerce Department publishes quarterly estimates of US economic output, expressed as an annualised rate. Its reading for the second quarter came in at 1.5 percent, weaker than forecasters had expected, with a widening trade deficit subtracting from output. Underlying demand was not uniformly weak: consumer spending picked up, and companies kept investing heavily in equipment tied to the buildout of artificial-intelligence capacity. What unsettles investors is the combination of slower headline growth with price pressures that have not faded, a mix that complicates the outlook for interest rates.
S&P traders are bracing for wild swings because Warsh is saying nothing, Bloomberg reported on Saturday. The Financial Times said in its chart of the week the same day that Warsh has spooked long bonds.
The Bureau of Economic Analysis put annualised second-quarter growth at 1.5 percent, less than expected, according to figures reported on Friday. The Tehran Times, citing new employment data, reported that 97,000 workers were laid off.
The Commerce Department reported annualised growth of 1.5 percent, below expectations, as a widening trade deficit weighed on output. Consumer spending accelerated and business investment in equipment tied to the artificial-intelligence buildout stayed robust, but persistent price pressures are unsettling financial markets.