Recent data continues to be mostly negative. Manufacturing was the lone bright spot as manufacturing industrial production surged +1.1% m/m to a +3.2% y/y rate, while the Philly Fed’s survey also showed an uptick in activity. By contrast the Empire State survey, while still positive, dropped for the second straight month and is at the lowest level since May 2017. And like that survey, the Fed’s Beige Book reported widespread slowing. The Housing Market Index rebounded slightly from last month’s reading to 58, but that’s well below last January’s 72 points. The measure of foot traffic remains in contraction territory well below 50 at 44. Existing home sales fell to the lowest level in over three years, losing
-6.4% m/m to -10.3% y/y, while prices fell for the fifth time in six months. Consumer sentiment plunged -7.6 points to 90.7, with the expectations component falling almost -9 points to 78.3. Part of the drop in sentiment was likely caused by the government shutdown which is entering its 32nd day, and is estimated to cost 0.2% of GDP growth every month.