Weekly economic update for September 27, 2021


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


economy
  • The Conference Board Leading Economic Index rose in August.
  • Housing starts increased 3.9% in August compared with July, according to the Census Bureau.
  • Existing-home sales dropped 2.0% in August compared with July, the National Association of Realtors reported.


Employment
  • Initial jobless claims rose by 16,000 to 351,000 in the week ended September 18, 2021, according to the Labor Department.


Profits
  • As of September 15, 2021, of the 500 S&P 500 Index companies reporting second-quarter earnings, 430 beat analysts’ estimates, according to S&P Dow Jones Indices.


Emotion
  • The NFIB Small Business Optimism Index increased slightly in August.


Europe
  • The IHS Markit Flash Eurozone Composite PMI Output Index dropped to 56.1 in September from 59.0 in August.
  • The European Commission’s Flash Consumer Confidence Indicator for the euro area rose in September.


Rates
  • The yield on the 10-year Treasury note rose.
  • The Federal Reserve held rates steady and noted that if progress toward its employment and price stability goals continues, “a moderation in the pace of asset purchases may soon be warranted.”
  • The Bank of England maintained its current bank rate and warned that inflation could rise above its target by the end of 2021.
  • The Bank of Japan kept rates steady and continued its quantitative easing policy.


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.
  • A shift from “just in time” to “just in case” inventory models could exacerbate supply chain concerns.


Go behind the numbers for commentary from Putnam's active investors

Putnam Perspectives


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.