Chart pack

U of Michigan Confidence

3 mo Simple Moving Average of 5-10 Inflation expectations from U of M

Retail Sales Control Group A bit Volatile of late as you can see this months data better than expected

From Grant Thornton “Core retail sales, which feed into consumer spending in the overall GDP figures, bounced back at a 1.4% pace after contracting more than initially reported in August. Consumers have shifted away from spending on services to goods in the wake of COVID. Look for the tradeoff between goods and services to accelerate as we get into the holiday season. Travel and tourism are expected to be particularly weak if the threat of contagion continues to rise. The number of COVID cases is surging again, which will further limit use of indoor venues. The restaurant industry is seeing permanent closures accelerate, while large chains that are able to pivot more to curbside and drive-through services are gaining market share.”

lastly a Bit of Economic data that missed expectations today,capacity Utilization. From BBG capacity Utilization tracks the extent to which the installed productive capacity of a country is being used in the production of goods and services” This can be also views as a soft proxy for inflation or disinflation. In the 1970s and 80s cap Ute was in the mid to upper eighties and inflation was much higher then today.use this range then as a point where capacity Ute can be considered inflationary,or deflationary. two proxies today for inflation U of Mich and Cap utilization both lean disinflation

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