This week, the employment report came in stronger than expected, weekly same-store retail sales were better than expected, and Prices Paid for ISM Services came in higher than expected.
The bottom line is that momentum in the economy is strong, and the narrative that monetary policy is restrictive is wrong.
Combined with higher animal spirits and the latest Atlanta Fed GDP estimate at 2.7%, we see a 40% probability that the Fed will hike rates in 2025.
Our latest chart book with daily and weekly indicators for the US economy is available here.
Source: OpenTable, Apollo Chief EconomistSource: Redbook, Haver Analytics, Apollo Chief EconomistFor week ending on January 10th, 2025. Note: Filings are for companies with more than $50 million in liabilities. Source: Bloomberg, Apollo Chief EconomistSource: Census, Haver Analytics, Apollo Chief EconomistNote: The economic conditions indices are computed with mixed-frequency dynamic factor models with weekly, monthly, and quarterly variables that cover multiple dimensions of state economies. The indices are scaled to 4-quarter growth rates of U.S. real GDP and normalized such that a value of zero indicates national long-run growth. Source: Baumeister, Christiane, Danilo Leiva-Leon, and Eric Sims (2024), “Tracking Weekly State-Level Economic Conditions,” “Review of Economics and Statistics, 106(2), 483-504,” Apollo Chief EconomistNote: Consists largely of debit card transactions. Source: Bloomberg, Apollo Chief EconomistSource: Bloomberg, Apollo Chief EconomistSource: MTA, Apollo Chief Economist
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