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Consumer sentiment tops expectations in November, stays on pace for best year since 2000

A preliminary reading on consumer sentiment for November released on Friday came in slightly above expectations. The University of Michigan’s consumer sentiment index hit 98.3. Economists polled by Refinitiv expected the preliminary read to come in at 98, slightly below an October print of 98.6. “Consumer sentiment remained virtually unchanged in early November from its October reading,” Richard Curtin, chief economist for the Surveys of Consumers, said in a statement. “The stability of consumer sentiment at high levels acts to mask some important underlying shifts. Income expectations have improved and consumers anticipate continued robust growth in employment, but consumers also anticipate rising inflation and higher interest rates.” The Federal Reserve kept...

US wholesale prices jump 0.6% in Oct, the most in 6 years

U.S. wholesale prices rose by the most in six years last month, led higher by more expensive gas, food, and chemicals. The Labor Department said Friday that the producer price index — which measures price increases before they reach the consumer — leapt 0.6 percent in October, after a smaller 0.2 percent rise in September. Producer prices increased 2.9 percent from a year earlier. Excluding the volatile food and energy categories, core wholesale prices rose 0.5 percent in October and 2.6 percent from a year earlier. Despite last month’s increase, the figures suggest inflation pressures are mostly in check. The year-over-year price increase is lower than it was in the summer, when it topped 3 percent. And oil prices declined in October, which will likely to lower gas costs in the comi...

US weekly jobless claims fall slightly to a 45-year low

New applications for U.S. unemployment fell slightly last week and the number of Americans receiving benefits remained at a 45-year low as strong labor market conditions continued. Initial claims for state unemployment benefits dropped by 1,000 to a seasonally adjusted 214,000 for the week ended Nov. 3, the Labor Department said on Thursday. Data for the prior week was revised to show 215,000 claims received, which was 1,000 more than previously reported. The weekly claims were in line with predictions of economists polled by Reuters, who had forecast 214,000 people would file for benefits. The Labor Department said claims for North Carolina continued to be affected by Hurricane Florence, while Hurricane Michael impacted those for Florida and Georgia. Claims data for Massachusetts was esti...

Tax cuts have been controversial, but voters didn’t seem to care about them

Voters in the midterm elections felt neither tremendously motivated by the 2017 tax cuts nor had their lives been changed much by them, according to NBC News exit polls. Among those interviewed after voting Tuesday, some 45 percent said the tax cuts had no impact on their personal finances. In terms of how it affected their midterm election vote, there was no direct question on taxes, but just 22 percent listed the economy as their top priority. More cared about health care (41 percent) and immigration (23 percent). Responses did, however, shift sharply along party lines, with 84 percent of Republicans saying the new tax laws helped their personal finances against just 15 percent of Democrats. By the same token, 83 percent of Democrats said the cuts hurt their finances vs. just 15 percent ...

Healthcare topped the economy as the biggest issue for voters now, here’s why

Healthcare was the top issue for Americans voting in Tuesday’s midterm elections — for an understandable reason. Spending on medical care has skyrocketed in the past 20 years, hitting record levels in 2018 and weighing on both workers and employers. More U.S. voters cited it as their top concern on the ballot, ahead of the economy or any other issue, for the first time in at least a decade, according to exit polls by NBC News. Forty one percent of those polled cited healthcare as their top issue, followed by immigration at 23 percent. Roughly 70 percent of all voters, Democrat and Republican, said that the U.S. healthcare system needs “major changes” while only 4 percent said it needed no changes at all. Spending on medical care is the highest it has ever been. The United...

A new cold war is brewing between China and the US, says former Treasury Secretary Paulson

A new cold war is brewing between China and the U.S. if both nations don’t take steps toward reconciliation, former Treasury Secretary Henry Paulson warned in a speech that painted a bleak picture of the future between the two sides. In remarks delivered Tuesday, Paulson, who helped guide the nation out of the financial crisis and also served as Goldman Sachs CEO, warned that “big parts of the global economy will ultimately be closed off to the free flow of investment and trade” should the impasse continue. “And that is why I now see the prospect of an Economic Iron Curtain — one that throws up new walls on each side and unmakes the global economy, as we have known it,” he said at the Bloomberg New Economy Forum. Washington and Beijing have been involved in an...

Mortgage applications drop to 4-year low as interest rates hit 8-year high

Rising interest rates are now clearly taking their toll on potential homebuyers. Total mortgage application volume fell 4 percent last week from a week earlier and plunged 16 percent from a year ago, according to the Mortgage Bankers Association’s seasonally adjusted index. Mortgage applications to purchase a home led the volume lower, falling 5 percent for the week to the lowest level in two years. Purchase applications were 0.2 percent lower than a year ago. “Housing supply has been quite constrained for several years. As a result, the housing market has been out of whack, with home prices increasing at twice the rate of income growth,” said Michael Fratantoni, the MBA’s chief economist. “That was not sustainable.” Rising interest rates are now weakeni...

Gridlock in Washington won’t be good for a stock market thirsty for more tax cuts and spending

I can’t be the only person who has a problem with the consensus on the election and the markets. The consensus view is that the Democrats will take the House and the Republicans will keep control in the Senate, and that this combination will be good for stocks because gridlock is traditionally good for stocks. Bank of America’s comment on the topic is a good example of the current thinking: It says stocks could surge 12 percent on Washington gridlock. It’s true that gridlock often has been good for stocks, but it’s not clear it will be this time around. Remember, much of the benefit to stocks in the last two years has come because we were not in a gridlocked environment. That’s how the tax cuts got through. So, for the last two years, stocks have risen because...

There are more than 7 million job openings, near a record high and way more than people unemployed

The level of job openings in the U.S. edged lower in September but was still well ahead of the total number of people looking for work, the Labor Department said Tuesday. Vacancies edged lower to just over 7 million, according to the Job Openings and Labor Turnover Survey. The JOLTS report measures the level of employment vacancies as well as those who have left their positions. The previous count, for August, showed a record high of 7.3 million openings, a number revised higher in the report Tuesday. Consensus estimates from FactSet had pointed to a slight decrease for September, but still at 7.125 million. Despite the decrease, the level of openings still dwarfed the level of those considered unemployed, which was just under 6 million for September. The ranks of the unemployed moved up t...

Goldman Sachs: The economy needs to slow down to avoid a ‘dangerous overheating’

A thriving labor market is part of a continuing economic boom that will have to slow down or it eventually will cause trouble, according to a Goldman Sachs analysis. Nonfarm payrolls rose by 250,000 in October and the unemployment rate held at a 49-year low of 3.7 percent, according to Labor Department data released Friday. On top of that, average hourly earnings rose 3.1 percent from the same period a year ago, the fastest pace during the post-Great Recession recovery. While that’s all good news, concerns are now rising about the pace of gains. The Federal Reserve estimates that the natural rate of employment is around 4.5 percent, which Jan Hatzius, Goldman’s chief economist, calls “broadly reasonable.” Looking down the road, Goldman sees unemployment falling to 3...

US sanctions will push Tehran’s hardliners to the fore, Iranian American council warns

The reimplementation of U.S. sanctions on Iran will benefit the hard-line faction within the Middle East country, according to the Washington, D.C.-based National Iranian American Council (NIAC). The non-profit group — which aims to represent Iranian Americans — added that the sanctions could also isolate the United States and increase its reliance on Saudi Arabia in the region. Policy Director Ryan Costello told CNBC Monday that the current president of Iran, Hassan Rouhani, is a moderate figure who may have to adopt a tougher stance if he is retain control of the country? “Rouhani really has had the rug pulled out from in terms of sanctions … When you look at the forces who have benefited from this decision it is the IRGC (Islamic Revolutionary Guard Corps) who have benefited,̶...

Fixing trade war will need more than talks between Trump and Xi, WTO’s Azevedo says

Trade tensions can’t be fixed by talks between Washington and Beijing alone, according to the World Trade organization (WTO). President Donald Trump has long promised to redress a trade imbalance between China and the U.S. and since gaining power has attempted to reduce the deficit by imposing tariffs on goods and services. Trump’s protectionist measures have been countered by President Xi Jinping, leading talk of a trade war. Those fears have translated into choppy and dramatic trading in equity markets across the globe. Trump and Xi are expected to talk trade in the upcoming G-20 meetings, igniting speculation that a trade deal could be in the offing. But speaking to CNBC’s Eunice Yoon on Monday, the WTO’s Director General, Roberto Azevedo, said that while bilater...