Weekly economic update for October 25, 2021


Highlights of key economic statistics from last week compiled by Putnam Investments.


economy
  • Industrial production fell 1.3% in September, the Federal Reserve stated.
  • Housing starts fell 1.6% in September compared with August, the Census Bureau found.
  • Existing home sales jumped 7.0% in September compared with August, according to the National Association of Realtors.


Employment
  • Initial jobless claims fell by 6,000 to 290,000 in the week ended October 16, 2021, the Department of Labor stated.


Profits
  • As of October 19, 2021, of the 57 S&P 500 Index companies reporting third-quarter earnings, 47 beat analysts’ estimates, according to S&P Dow Jones Indices.


Emotion
  • The NAHB/Wells Fargo Housing Market Index showed builder confidence climbed higher in October.


Europe
  • The euro area annual inflation rate rose to 3.4% in September from 3.0% in August, Eurostat found.
  • The European Commission’s Flash Consumer Confidence Indicator for the euro area edged down in October.
  • Germany’s Federal Statistical Office noted industrial producer prices rose 2.3% in September compared with August.


Rates
  • The yield on the 10-year Treasury note rose.


Risks
  • Divergent vaccination rollout timelines and virus mutations risk could cause a shift from a synchronized global recovery to a more fractured regional, multispeed recovery.
  • Global leverage, created by pandemic response packages, is at worrisome levels and will eventually need to be paid for.
  • Upward pressure on inflation from multiple fronts (energy prices, housing costs and the labor market) could pressure central banks to pull forward their timelines for monetary policy normalization.


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All economic and performance information is historical and does not guarantee future results. The views and opinions expressed are those of Putnam Investments, are subject to change with market conditions, and are not meant as investment advice.