Business Cycle Indicators as of 1/29 as Real 10 Year Rate Goes Negative

Monthly GDP growth is slow in December:

 

Figure 1: Nonfarm payroll employment (blue), industrial production (red), personal income excluding transfers in Ch.2012$ (green), manufacturing and trade sales in Ch.2012$ (black), and monthly GDP in Ch.2012$ (pink), all log normalized to 2019M01=0.  Source: BLS, Federal Reserve, BEA, via FRED, Macroeconomic Advisers (1/29 release), and author’s calculations.

Spreads and the real rate continue flirt with zero.

 

Figure 2: Ten year – three month Treasury spread (blue), and Ten-year TIPS yield (red), both in %. Source: Federal Reserve via FRED, Treasury, and author’s calculations.

Atlanta Fed GDPNow is 1.7% q/q SAAR for 2019Q4 (as of today), NY Fed Nowcast at 1.22 (from 1/24).