Highlights of key economic statistics from last week compiled by Putnam Investments.
- The IHS Markit U.S. Composite PMI Output Index slipped to 57.0 in December from 57.2 in November.
- Factory orders increased 1.6% in November, the Census Bureau noted.
- The trade deficit widened sharply in November, the Census Bureau stated.
- Initial jobless claims increased by 7,000 to 207,000 in the week ended January 1, 2022, the Department of Labor reported.
- The United States added 199,000 jobs and the unemployment rate fell to 3.9% in December from 4.2% in November, according to the Bureau of Labor Statistics.
- As of December 31, 2021, of the 15 S&P 500 Index companies reporting fourth-quarter earnings, 11 beat analysts’ estimates, according to S&P Dow Jones Indices.
- The European Commission’s Economic Sentiment Indicator for the euro area eased in December.
- Eurostat noted euro area annual inflation is expected to rise to 5.0% in December from 4.9% in November.
- The IHS Markit Eurozone Composite PMI Output Index dropped to 53.3 in December from 55.4 in November.
- Eurostat reported euro area industrial producer prices rose 1.8% in November compared with October.
- The yield on the 10-year Treasury note rose.
- Federal Reserve policymakers noted, “... it may become warranted to increase the federal funds rate sooner or at a faster pace than participants had earlier anticipated,” in December meeting minutes.
- Upward pressure on inflation from multiple fronts (supply chain disruptions, housing costs, and the labor market) could pressure central banks to pull forward their timelines for monetary policy normalization.
- Declining liquidity and deteriorating financial conditions, combined with high valuations, should lead to a substantial uptick in risk asset volatility.
- Global leverage, created by pandemic response packages, is at worrisome levels and will eventually need to be paid for.
Go behind the numbers for commentary from Putnam's active investors
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.
For informational purposes only. Not an investment recommendation.
This material is provided for limited purposes. It is not intended as an offer or solicitation for the purchase or sale of any financial instrument, or any Putnam product or strategy. References to specific asset classes and financial markets are for illustrative purposes only and are not intended to be, and should not be interpreted as, recommendations or investment advice. The opinions expressed in this article represent the current, good-faith views of the author(s) at the time of publication. The views are provided for informational purposes only and are subject to change. This material does not take into account any investor’s particular investment objectives, strategies, tax status, or investment horizon. Investors should consult a financial advisor for advice suited to their individual financial needs. Putnam Investments cannot guarantee the accuracy or completeness of any statements or data contained in the article. Predictions, opinions, and other information contained in this article are subject to change. Any forward-looking statements speak only as of the date they are made, and Putnam assumes no duty to update them. Forward-looking statements are subject to numerous assumptions, risks, and uncertainties. Actual results could differ materially from those anticipated. Past performance is not a guarantee of future results. As with any investment, there is a potential for profit as well as the possibility of loss.
Diversification does not guarantee a profit or ensure against loss. It is possible to lose money in a diversified portfolio.
Consider these risks before investing: International investing involves certain risks, such as currency fluctuations, economic instability, and political developments. Investments in small and/or midsize companies increase the risk of greater price fluctuations. Bond investments are subject to interest-rate risk, which means the prices of the fund’s bond investments are likely to fall if interest rates rise. Bond investments also are subject to credit risk, which is the risk that the issuer of the bond may default on payment of interest or principal. Interest-rate risk is generally greater for longer-term bonds, and credit risk is generally greater for below-investment-grade bonds, which may be considered speculative. Unlike bonds, funds that invest in bonds have ongoing fees and expenses. Lower-rated bonds may offer higher yields in return for more risk. Funds that invest in government securities are not guaranteed. Mortgage-backed securities are subject to prepayment risk. Commodities involve the risks of changes in market, political, regulatory, and natural conditions. You can lose money by investing in a mutual fund.
Putnam Retail Management.