US macro data support fourth rate hike in 2018

When I say that the US macro data support a fourth rate hike this year, I mean that the data are good enough for the Fed to dismiss economic concerns for adding a hike in December. Ultimately, the Fed will make its rate decision based on inflation and employment. But a robust economic background will shift the balance in favor of more hikes.
ISM and GDPNow macro data from Friday
Two recent data points show strength. The ISM Manufacturing Index came in on Friday above expectations. And all the sub-indices the Fed would care about were robust. I have highlighted them in yellow.

On the back of these numbers and the jobs report, the Atlanta Fed moved its Q2 GDP tracker, GDPNow, up to 4.8% on Friday. The chances are strong that we hit annualized 12-month growth above 3% when the BEA re...


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