Treasury
The latest Business Roundtable survey shows that confidence among CEOs of major U.S. companies rose this month, but employment plans have trended toward contraction for three consecutive quarters, with the willingness to lay off workers reaching its highest level since the Great Recession. Expectations for sales and capital expenditure improved slightly, and labor costs are regarded as the primary factor in inflation. The Federal Reserve cut interest rates by 25 basis points on the same day, with internal disagreements over inflation and employment risks.
Costco sued the Trump administration last month, seeking a declaration that tariffs imposed under the International Emergency Economic Powers Act of 1977 are illegal and a full refund of taxes paid, sparking anxiety among the business community to follow suit. Doreen M. Edelman, a partner at Lowenstein Sandler, noted that litigation is just one of several strategies to protect refund rights, and companies should prioritize the timing of goods liquidation before deciding whether to sue, apply for extensions, or wait for a Supreme Court ruling.
The Federal Reserve cut its benchmark interest rate by 25 basis points to a range of 3.5%-3.75%, despite opposition from three officials. The latest economic projections suggest only one rate cut in 2026, with core PCE inflation expectations lowered to 2.5% and economic growth expectations raised to 2.3%. Chair Powell emphasized rising downside risks to the labor market.
Data released by the US Bureau of Labor Statistics on Tuesday showed that job openings rose to their highest level in five months in October, but hiring activity slowed, indicating signs of cooling in the labor market. Healthcare, retail, and wholesale trade industries pushed up the total number of job openings. Meanwhile, the quits rate fell to a near three-year low, increasing expectations of a Federal Reserve interest rate cut.
Data from the U.S. Bureau of Labor Statistics shows that the core personal consumption expenditures price index rose 0.2% month-over-month and 2.8% year-over-year in September, with inflation holding steady. Analysts believe this provides a basis for the Federal Reserve to cut rates by 25 basis points on December 10, but there are divisions within the Fed regarding the policy path.
The ADP employment report shows that the U.S. private sector saw a net loss of 32,000 jobs in November, with small businesses cutting 120,000 jobs and large businesses adding 90,000. Wage growth slowed, with pay increases for job switchers falling to 6.3%. Federal Reserve officials are divided over whether to cut rates at next week's policy meeting, with market expectations for a rate cut rising to 89%.
The ISM manufacturing PMI fell to 48.2%, remaining in contraction territory for the ninth straight month. New orders declined for the third consecutive month, employment contraction accelerated, and tariff and policy uncertainty suppressed export demand. Meanwhile, manufacturing activity in New York state unexpectedly accelerated, and S&P Global reported output growth, but high inventories and profit pressures suggest deeper concerns. Federal Reserve officials hinted at possible interest rate cuts to support the economy.
Data released by the Conference Board on Tuesday showed that the consumer confidence index dropped sharply by 6.8 points to 88.7 in November, the lowest level since the full tariffs were implemented in April. Key sub-indices, including labor market, business conditions, and income expectations, all weakened across the board, with respondents widely citing prices, tariffs, and political factors. Meanwhile, retail sales in September grew only 0.2%, below expectations, indicating that consumer momentum is slowing.
A survey released Monday by the National Association for Business Economics (NABE) shows that U.S. employment growth is slowing, with the unemployment rate expected to rise to 4.5% next year. The survey also indicates that inflation will remain above the Fed's 2% target, but most forecasters expect the Fed to cut interest rates by 25 basis points at its December meeting.
The University of Michigan survey shows U.S. consumer confidence fell near record lows this month, mainly due to persistent inflation and personal income pressures. Although one-year inflation expectations edged down to 4.5%, consumer frustration over high prices and weak incomes remains. Federal Reserve officials' remarks may open the door for a December rate cut.