Weekly economic update for February 28, 2022

Weekly economic update for February 28, 2022

Putnam Investments | February 28, 2022

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

economy

  • GDP increased at an annual rate of 7.0% in the fourth quarter, the Bureau of Economic Analysis found.
  • New home sales fell 4.5% in January compared with December, according to the Census Bureau.
  • The PCE Price Index rose 0.6% and core PCE increased 0.5% in January compared with December, the Bureau of Economic Analysis stated.
Employment

  • Initial jobless claims fell by 17,000 to 232,000 in the week ended February 19, 2022, according to the Department of Labor.
Profits

  • As of February 15, 2022, of the 387 of S&P 500 Index companies that reported fourth-quarter earnings, 299 beat analysts’ estimates, according to S&P Dow Jones Indices.
Emotion

  • The Conference Board Consumer Confidence Index declined in February.
  • The University of Michigan’s index of consumer sentiment dropped to 62.8 in February from 67.2 in January.
Europe

  • Russia’s invasion of Ukraine pushed up crude oil and natural gas prices in Europe, with some futures contracts rising more than 40%.
  • Eurostat found euro area annual inflation rate increased to 5.1% in January from 5.0% in December.
  • The IHS Markit Flash Eurozone Composite PMI Output Index rose to 55.8 in February from 52.3 in January.
  • Germany’s Federal Statistical Office reported producer prices increased 2.2% in January compared with December.
Rates

  • The yield on the 10-year Treasury note rose.
Risks

  • Rising energy prices, worsened by the Russia-Ukraine crisis, increase the risk of stagflation and recession, even as central banks seek 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 is at worrisome levels, and will eventually need to be paid for, at a time when most developed markets are facing a fiscal drag from the end of post-pandemic stimulus.

Go behind the numbers for commentary from Putnam’s active investors

Putnam Perspectives

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.

More in: Macroeconomics