Earnings Snap – Q4'23

Labor

• Seasonally adjusted initial jobless claims decreased 12,000 to 201,000, below the expected 218,000, while the 4-week moving average decreased 3,500 to 215,250. The decline may have been exaggerated by an usually large drop in unemployment filings in California, however. The state gave an estimate of its claims because of processing delays tied to the President’s Day holiday. Continuing claims, a proxy for layoffs, totaled 1.86M, down 27,000. (Source: Labor Department)

Fed Meeting Minutes

• More Federal Reserve officials signaled concern at their meeting last month with cutting interest rates too soon compared to the risks of holding rates too high for too long. Only two officials pointed to the risks “associated with maintaining an overly restrictive stance for too long.” (Source: WSJ)

Leading Economic Index

• The Conference Board Leading Economic Index® (LEI), an index which includes components such as average weekly hours in manufacturing, new orders for consumer goods and materials, the performance of the stock market, and expectations for the economy, fell by 0.4% in January 2024 following a 0.2% decline in December 2023. The LEI has contracted by 3.0% over the last six months. (Source: The Conference Board)

U.S. Justice Department

• The U.S. Justice Department named its first official focused on artificial intelligence as the department grapples with the potentially transformative effects of AI on federal law enforcement and the criminal justice system. Jonathan Mayer, a professor at Princeton University who researches technology and law, will serve as chief science and technology adviser and Chief AI Officer. (Source: Reuters)

China

• China’s major banks reduced the five-year loan prime rate, a benchmark for home loans, to a new low of 3.95%, down from 4.2% previously. It was the largest cut since the rate was introduced five years ago, and a much bigger reduction than economists had expected. The move was another step in China’s broad campaign to prop up a crumbling housing market and support an economy battling deflation, slowing exports, and moribund consumer confidence. (Source: WSJ)