Weekly economic update for February 7, 2022

Putnam Investments | February 7, 2022

Highlights of key economic statistics from last week compiled by Putnam Investments.

Factory orders fell 0.4% in December, the Census Bureau stated.
Construction spending increased 0.2% in December compared with November, the Census Bureau reported.

Initial jobless claims fell by 23,000 to 238,000 in the week ended January 29, 2022, the Department of Labor reported.
The United States added 467,000 jobs and the unemployment rate rose to 4.0% in January from 3.9% in December, according to the Department of Labor.

As of January 27, 2022, of the 166 S&P 500 Index companies reporting fourth-quarter earnings, 132 beat analysts’ estimates, according to S&P Dow Jones Indices.

Japan’s Consumer Confidence Index declined in January.

Euro area annual inflation rose to 5.1% in January from 5.0% in December, according to Eurostat.
Eurostat reported that euro area GDP grew 0.3% in the fourth quarter.
Germany’s Federal Statistical Office noted retail sales dropped 5.5% in December compared with November.

The yield on the 10-year Treasury note increased.
The European Central Bank held rates steady and indicated it would discontinue its net asset purchases by the end of March.
The Bank of England increased its bank rate by 0.25 percentage points to 0.5%.

Upward pressure on inflation from multiple fronts (supply chain disruptions, housing costs, and the labor market) could pressure central banks to pull forward their timelines for monetary policy normalization.
Declining liquidity and deteriorating financial conditions, combined with high valuations, should lead to a substantial uptick in risk asset volatility.
Global leverage, created by pandemic response packages, is at worrisome levels and will eventually need to be paid for.

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All economic and performance information is historical and does not guarantee future results. The views and opinions expressed are those of Putnam Investments, are subject to change with market conditions, and are not meant as investment advice.