- The US government reopened on November 13th and ongoing data releases have resumed. However, some collection processes have been disrupted; Fed Chair Powell recommends viewing early reports with a “skeptical eye.”
- Annual headline CPI inflation fell 30 bps from September to 2.7% in November and core CPI fell 40 bps to 2.6%. Due to the government shutdown, the Bureau of Labor Statistics did not release an October CPI report.
- The Fed lowered the federal funds rate for a third time in 2025 at its December meeting to a range of 3.5%-3.75%.
- US employment rose by 64K in November after falling by 105K in October (mostly due to DOGE cuts). Trailing three-month job growth was 22K, reflecting a cooling employment market.
- Annual wage growth fell 20 bps to 3.5% in November. Over the last three months, wages grew by 3.1% (annualized).
- Consumer sentiment improved in December but remained very low. Views of current conditions fell slightly while consumer expectations rose.
* Latest data available.
Investment in artificial intelligence has super-charged US GDP growth in recent quarters and may be helping the economy avoid a recession. Barclays estimates that AI-related investment lifted GDP growth by roughly one percentage point (annualized) in the first half of 2025. posits that elevated AI investment is likely to persist while others have raised concerns that the US economy has become overly dependent on AI spending.
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