Chart of the Day
The Job Openings and Labor Turnover Survey showed that the job openings increased by 7.4% MoM in July, to a new record of 10.9 million. That means job openings are now well above the official number of unemployed people, at 8.4mn. Whether those people will soon take any of these jobs is another question and will be key to wage developments in the coming months. If wage growth starts to pick up even though the unemployment rate is still fairly high, the Fed could start to get concerned about the outlook for inflation and reassess its judgment of what full employment really is.
Macro
Japan’s economy watchers survey fell sharply again in August and points to negative GDP growth.
The Bank of Canada held policy unchanged yesterday. Its continuing with QE, but has still seen its balance sheet fall relative to GDP this year.
In July, consumer price inflation in China rose to 1.0%, while producer inflation decreased to 9.0%.
Markets
Brazil’s Bovespa sank by 4% yesterday – it’s far behind the other major EM indices in terms of recent performance.
Foreign investors have been fleeing the country it appears- the Brazilian real also dropped sharply.
Palladium prices fell sharply yesterday and have now reversed all of their gains earlier this year – despite the idea that demand for the metal will rise sharply as governments pursue cleaner energy sources.
There were some signs of concerns in US markets as well – the Russell dropped by 1.1%.
Semiconductor stocks have also been falling after their recent strong run.
Moreover, the jump in the VVIX may be a sign there is more volatility ahead.
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