Tag Archive for: financial resilience

China’s Industrial Profits Take a Hit: Analyzing July’s Decline and Market Implications

China Industrial Profits Fall 1.7% in July, Defying Expectations; Hang Seng Index Experiences Mixed Movement

By Bob Mason | Published August 27, 2025, 02:36 GMT

China’s industrial profits drop 1.7% in July during the January to July period. The fall comes close to the 1.8% that experts had predicted. Tariffs, lower global demand, and price cuts from fierce competition add weight to the loss.

Industrial Profits and Margins Under Pressure

The drop in profits is a sign of weakness in China’s manufacturing sector. Companies now face high input costs and lower selling prices. US tariffs and soft export numbers push margins down. These pressures also make it hard for firms to win new business.

Manufacturing Sector Weakness Reflected in PMI Data

China’s S&P Global Manufacturing Purchasing Managers’ Index fell from 50.4 in June to 49.5 in July. The score slipping below 50 shows that manufacturing activity is contracting. Export orders have dropped for four months in a row.

Key points in the PMI report include:
• Export orders falling for a fourth month
• Input prices rising with higher raw material costs
• Companies cutting selling prices to deal with competition

Lower demand and squeezed margins force manufacturers to reduce their workforce. Fewer jobs add to the problems in the labor market and may slow Beijing’s drive to boost domestic spending.

Labor Market Challenges Mount

China’s job market shows signs of strain. The overall unemployment rate rose to 5.2% from 5.0% in June. Youth joblessness climbed from 14.5% to 17.8% at the same time. Many new graduates now face a hard search in a tight job market. Policymakers are working on plans that bring more jobs and steady the economy.

Beijing’s Policy Response to Economic Headwinds

With the economic speed dropping in the third quarter, Premier Li Qiang has announced plans to increase government spending, steady the housing market, and fix work market issues. Experts expect Beijing to introduce more support measures this year to meet the 5% GDP goal for 2025. Natixis Asia Pacific Chief Economist Alicia Garcia Herrero said:
"China may meet its 2025 growth aim if more stimulus comes; the later months must face risks from trade issues and falling prices. The government is ready to add more steps when needed."

Market Reaction and Outlook

While profits fell less than expected, the market did not show full confidence. The Hang Seng Index reached 25,653 and then dropped to 25,565. It finally closed 0.26% higher at 25,592. Meanwhile, Mainland China’s CSI 300 and Shanghai Composite Index dropped slightly by 0.05% and 0.18%.

Looking ahead, the National Bureau of Statistics Manufacturing PMI for August and new trade talks with the US will shape views. Reports say China’s trade official Li Chenggang may soon visit Washington to restart discussions. A PMI score above 50 could ease worries, while a lower score might push Beijing to push stronger measures to boost growth.

About the Author:
Bob Mason has more than 28 years of experience in finance. He studies money, raw goods, stocks, and major economic trends across Europe and Asia.

For more detailed reading and current market views, visit FXEmpire’s Economic Calendar.

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Emerging Optimism: Canadian Banks Report Economic Recovery Signs Amidst Tariff Uncertainties

Scotiabank and BMO See Signs of Economic Recovery Amid Cautious Optimism

By Naimul Karim | August 26, 2025

Scotiabank and BMO reported stronger third‐quarter earnings. Canadian banks share their news. Executives note that profits improve as economic data turns positive. They lower the measure of risk. Tariffs and U.S. trade still worry many. Yet, like green shoots, early recovery signs emerge.

Declining Uncertainty Sparks Confidence

BMO’s CEO Darryl White explained the change during an analyst call. He noted: earlier, his uncertainty was very high. Today, he sees less risk. Political issues and leadership doubt once clouded growth. Now, clarity improves. Some issues—geopolitics and a missing U.S. trade deal—remain. However, White links confidence to the fall in risk.

Economic Performance in the ‘Middle Innings’

White places the economy in its middle innings. He states that growth is modest and steady. The pace is as expected. The system does not run strong nor does it risk recession. Some sectors slow naturally during this phase.

Scotiabank Spotlights Consumer Spending Recovery

Scotiabank’s Chief Risk Officer Phil Thomas shows signs in consumer spending. Credit card data highlights green shoots. Thomas sees growth in retail sales during the second quarter. Challenges still hit younger consumers. Yet, the mixed data builds cautious hope for consumer strength.

Strong Earnings and Improved Credit Metrics

Both banks beat analyst expectations. BMO’s net income rose to $2.33 billion from $1.86 billion year-over-year. Earnings per share reached $3.14. Adjusted net income also improved. Scotiabank reported higher banking profits. It cut its credit loss provisions. BMO lowered total provisions from $906 million to $797 million. Scotiabank cut its provisions near a billion dollars—a $357 million drop from the previous quarter. Thomas admits that challenges persist. He links ongoing trade and macro concerns to a clouded near-term view.

Looking Ahead

BMO and Scotiabank lead the pack among the Big Six banks. Their results serve as a gauge of Canada’s economy. Tariff issues and pending U.S. trade details still weigh in. Nevertheless, rising consumer spending and stronger credit metrics hint at a wider recovery. For now, the banks expect steady, modest growth that varies by sector. Optimism remains cautious as leaders balance good data with remaining risk.

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Scotiabank Surpasses Expectations with Stellar Q3 Earnings Boosted by Global Banking Profits

Scotiabank Surpasses Analysts’ Expectations with Strong Q3 Earnings

August 26, 2025 | By Naimul Karim

Scotiabank (Bank of Nova Scotia) posted strong financial numbers for the third quarter ending July 31, 2025. The bank beat analyst predictions by raising profits in its global banking and markets divisions. The report shows revenue growth even as economic risks continue, especially from tariffs that affect Canadian trade.

Strong Net Income and Earnings Per Share

Scotiabank earned $2.53 billion. Last year in the same quarter, the number was $1.9 billion. This change gave a net earnings per share (EPS) of $1.84. When unusual items are removed, net income was $2.52 billion. That means adjusted EPS came to $1.88 per share. These figures beat the analyst estimate of about $1.73. CEO Scott Thomson praised the results. He tied the “very strong quarter” to rising revenue in all parts of the bank.

Decrease in Provisions for Credit Losses

Investors watch provisions for credit losses (PCLs) because they signal potential loan defaults and economic issues. In this quarter, total PCLs dropped to about $1 billion. This is $11 million less than Q3 last year and $357 million less than Q2 2025. PCLs for high-risk loans fell to $975 million in Q3 from $1.05 billion in the previous quarter. This drop mainly came from lower figures in the Canadian retail and corporate loan areas.

Segment Performance and Dividend Increase

The international banking division reported adjusted earnings of $716 million, a 7% rise over last year. In contrast, Canadian banking earnings fell 2% to $959 million compared to the previous year. Yet, they improved 56% from the prior quarter.

With its strong financial show, Scotiabank raised its quarterly dividend to $1.10 per share, up from $1.06. ### Market Context

Scotiabank is one of Canada’s Big Six banks and shows the health of the national economy. The Q3 results come at a time when trade tensions worry Canadian businesses. Analysts study the bank’s credit loss provisions to see if households and companies face stress.

Looking Ahead

The better-than-expected profits and improved credit outlook show that the bank stays strong at its core. Investors will keep an eye on global economic factors, like trade and overall trends, that may affect Scotiabank in the coming quarters.

For more updates and detailed financial analysis, subscribe to Financial Post for comprehensive coverage and insights.

Contact:
Naimul Karim
Email: nkarim@postmedia.com

This article is based on reporting by Financial Post and is authorized for publication with credit.

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BMO Surpasses Expectations: Record Profits and Reduced Credit Loss Provisions in Q3

Bank of Montreal Exceeds Expectations, Lowers Provisions for Credit Losses in Q3

August 26, 2025 — By Naimul Karim

BMO beats forecasts. BMO lowers credit loss reserves. BMO shows strong earnings. Each word links closely to the next.

Financial Performance Overview

BMO earns $2.33 billion. This is more than $1.86 billion from last year. Net income rises. Earnings per share reach $3.14. Adjusted net income grows to $2.39 billion from $1.98 billion before. Adjusted earnings per share then come in at $3.23. These numbers beat the expected $2.97 per share.

Segment Highlights

The bank earns strong results in U.S. operations, capital markets, and wealth management. In the U.S. sector, adjusted net income hits $769 million. This marks a 42% jump year-over-year. Wealth management and capital markets rise by 21% and 12% as well.

BMO’s Canadian business weakens. Its adjusted income falls by 5%. This drop equals a $50 million decrease to $870 million.

Provisions for Credit Losses Decline

Credit loss reserves matter. They show funds set aside for loan defaults. Many banks raised these reserves due to economic risks. BMO, however, lowers them to $797 million. This is down from $906 million one year ago.

The fall comes from U.S. and capital market operations. Canadian commercial banking and unsecured personal loans see higher reserves.

Management Commentary and Market Reaction

CEO Darryl White praises “disciplined execution.” He credits clear credit improvements. U.S. operations lead in profit.

Analyst John Aiken of Jefferies Inc. says U.S. retail is strong. He warns that most divisions barely meet forecasts. He notes that lower credit loss reserves drive the gains. He worries about negative U.S. loan growth. He expects that some banks could soon do better than BMO.

Analyst Mike Rizvanovic of Bank of Nova Scotia suggests that these results may lift earnings forecasts for 2026. Dividend Announcement

BMO declares a quarterly dividend of $1.63 per common share. It stays consistent with past quarters.

BMO’s report acts as an early sign of economic trends. Its results often guide ideas about Canada’s broader economy, especially with trade issues and other uncertainties.

For more information and detailed financial updates, readers are encouraged to subscribe to the Financial Post.

Contact: nkarim@postmedia.com

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Reviving Confidence: China’s New Housing Stimulus Fuels Stock Market Surge as Trade Talks Approach

China’s Housing Fix: New Stimulus Sparks Stock Gains, Trade Talks Loom

By Bob Mason
Published: August 26, 2025, 04:06 GMT+00:00

Beijing’s New Stimulus Aims to Revive Housing and the Economy

Beijing set new policies to help its weak housing market. The city made these plans in Shanghai on August 25, 2025. The policies are meant to raise buyer demand and lift the real estate scene. Investors saw the news and grew hopeful when stocks reached highs seen in many years.

Officials said the rules start on August 26. They ease rules for buying houses and raise limits on loans from housing funds. Buyers can use funds for down payments. The state also drops a temporary tax for first-time buyers who live outside the area. It cuts taxes on houses bought later by outsiders. The state will treat house loans the same, no matter if it is first or second. The aim is clear: help home buyers and steady the market.

Housing Data Sparks the New Plan

The housing market showed poor signs. From January to July 2025, building work in real estate fell 12% compared to last year. In July, home sales areas dropped 4% against last July. June dropped by 3.5% before. Total sales fell 6.5%. New houses lost 0.3% of their value in July. For the first seven months, average home values slipped 4.5%.

These numbers show tough winds for a market that once powered China’s growth. A weak real estate scene joins the problems from trade strains with the United States. Factories slowed and buyers lost some hope.

Stock Market Lifts on Stimulus News

The news raised investor mood. The Hang Seng Mainland Properties Index jumped 3.64% at first and ended the day up 2.72%. Main indices in Mainland China moved up too. The CSI 300 hit highs seen in three years, and the Shanghai Composite reached a 10-year peak. Some experts watch the stocks and say that while the rise is real, retail investors act with care unlike past rallies.

Economist Hao Hong said that stock markets help shape how consumers feel. He thought a stock rebound can quickly lift home feel. He warned that slow retail cheer might help keep the rise steady and not cause a burst.

Economy Faces Growth Hurdles and Needs More Help

The mix of policy changes now lifts the market. Yet experts say more state support may be needed to reach the 5% GDP goal for 2025. Job loss among youth is a big worry. Youth rates rose from 14.5% in June to 17.8% in July, the highest in nearly a year. The overall rate sits at 5.2%. These job issues add fear to China’s growth path, hurt by trade strains and internal shifts.

Natixis Asia Pacific’s head economist Alicia Garcia Herrero said, "China may hit its target next year. But more state aid is needed, and the next half of the year will test us. Many gaps lie ahead, but the state has extra help if we need it."

A recent letter from Kobeissi pointed out signs of weakness:
• Fixed-asset growth slowed to 1.6% – the lowest in five years.
• Property growth fell by 12% – the worst drop since 2020’s lows.
• Retail sales grew only 3.7% in July, down from 4.8% in June.
• Industrial work grew at a slow 5.7% annually, the weakest since November.
• Yuan new loans showed a decline for the first time in twenty years, a sign of soft credit demand.

Market Moves and the Road Ahead

On August 26, 2025, stocks dipped in the morning but kept near recent highs by the close. The CSI 300 gained over 9% in August and more than 13% for the year. The Shanghai Composite gained about 8.5% in the month and more than 15% year-to-date. The Hang Seng Index grew by 28.6% this year.

These gains depend on more state help and better US-China ties. Rising trade strains or slow policy work can shake investor trust.

Trade Talks on the Horizon

With many pressures on the economy, traders and officials now watch US-China trade talks. The future of these talks can shift China’s path and affect world trade. As Beijing uses more measures to steady the market amid hard global and local issues, everyone watches how new trade steps and local plans join to impact both the market and the economy.

Conclusion

The new housing rules in China lifted stocks and brought careful hope to a slowing market. Yet experts say more state aid may be needed to hit growth goals and keep jobs safe. With trade talks coming, the next weeks will shape China’s path and how investors feel.

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Canada’s Banks to Reduce Provisions for Bad Loans: A Positive Outlook Amid Economic Uncertainty

Canadian Banks Anticipated to Set Aside Less for Bad Loans in Q3 Amid Easing Tariff Concerns

By Naimul Karim, Financial Post – August 25, 2025

Canada’s banks are set to share their third-quarter earnings this week. Analysts now expect that banks will set aside less money for bad loans. They see lower risk in borrowers. The easing tariff talks and fewer trade tensions add to this view. Each word links closely to the next, so the ideas stay clear and easy.

A Shift from Prior Quarters

Earlier in 2025, Canada’s Big Six banks acted with care. They saved extra funds for credit risk. In the second quarter, banks raised their funds for potential credit losses. They did this to guard against a possible trade war. U.S. tariffs once spooked the markets and stirred worry. Analysts noted that banks built large buffers then. Now, cooler views and steadier risk checks have emerged.

Growing Comfort Among Investors

Investors feel more at ease today. CIBC World Markets analyst Paul Holden said, “We are now comfortable with credit loss provisions that seem flat. Next year, we may even see smaller amounts.” Even if the 2025 economy is not at full strength, low unemployment and strong credit measures support stability. In recent months, Canadian bank stocks have gained about eight percent on average. Each word here connects simply to show this growing trust.

Economic Barometer and Upcoming Earnings

Canada’s big banks act as clear signals for the national economy. Their earnings tell us not only about their own health but also about wider trends. This week starts Tuesday with Bank of Montreal and Bank of Nova Scotia. Wednesday follows for Royal Bank of Canada and National Bank of Canada, and Thursday concludes with Canadian Imperial Bank of Commerce and Toronto-Dominion Bank. Lower credit loss numbers add a positive note, though some experts remain cautious. John Aiken of Jefferies Inc. warns that stock values may seem too high. When earnings miss, even good news might not lift shares further.

Conclusion

The soon-to-be-released reports show that Canadian banks now need less reserve for bad loans. This change supports a stronger view of financial stability. With tariff concerns easing, investors look past today’s risks to a steadier future.

Contact:
Naimul Karim
Email: nkarim@postmedia.com

Photo Caption:
Canada’s Big Six banks, which hold most of the nation’s financial power, issue quarterly results that help forecast economic health. (Photo by Andrew Lahodynskyj/The Canadian Press files)

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Market Buzz: Powell Hints at Potential Fed Rate Cut After Jackson Hole – Is a Shift in Policy on the Horizon?

Powell Signals Possible Fed Rate Cut as Policy Risks Shift After Jackson Hole Speech

By James Hyerczyk | August 22, 2025, 14:27 GMT

At the Jackson Hole Economic Symposium, Powell spoke in a clear, tight manner. He flagged that the Fed may cut rates soon. He did not promise a change, but his speech showed that the Fed sees more risk to growth. The market now links his words with a possible rate cut at the September FOMC meeting.

Cautious Yet Dovish Tone from Powell

Powell chose his words with care. His calm tone met market views that hint at softer policy soon. He tied today’s economic shifts to growing risks for growth. Powell said the risks might push the Fed to adjust its policy. His words kept the option for a cut open while urging care in each step.

Market Reacts: Stocks Rally, Yields Decline

Soon after Powell’s talk, U.S. stocks climbed. The Dow rose by over 600 points in one day. The two-year Treasury yield dropped 8 basis points to 3.71%. These moves reflect market ties between his words and a coming rate cut. Powell made it clear that future moves will rest on fresh economic data.

Mixed Economic Signals: Solid Labor Market, Inflation Risks

In his talk, Powell painted a picture that mixed strength with warning. The labor market stayed strong and overall growth held steady. Yet he pointed to trade and tariff risks that may push prices up. Supply problems from trade issues add pressure on inflation. Powell said reset time is needed before these factors calm down. His tone shows that the Fed will work from real data each day.

Revisiting Fed Framework and Maintaining Credibility

Powell recalled the 2020 move to flexible average inflation targeting. This plan let inflation rise above 2% for a time. He admitted that an unexpected run in prices after the pandemic forced a tough look at the plan. The goal remains a steady 2% inflation mark. Powell’s words stressed that the Fed must keep its promise on price stability while watching for growth risks.

Independence Amid Political Pressure

Powell also addressed the topic of politics. He stated that the Fed makes choices from data alone. His clear words push back on claims of political influence. In doing so, he upheld the idea that the Fed’s work rests on economic facts.

Looking Ahead: Data the Deciding Factor for September

Powell kept his focus on data. He said that future moves depend on fresh numbers, especially from inflation and consumer spending. Even though many now tie his words to a rate cut, the Fed waits for clear signals. Analysts see a chance to buy during market pulls when the data comes in weak. The big test lies ahead in September, with each number playing its part.

Summary

Powell’s Jackson Hole talk hints at a near-term rate cut as the Fed sees extra risk for growth. Markets pushed stocks up and pulled yields down, yet the Fed stands by a data-first path. Investors should look to upcoming reports as the September meeting draws near.

About the Author:
James Hyerczyk is a market analyst and teacher from the U.S. He brings over 40 years of experience in following price moves and chart trends. He has written two books on technical analysis and works with both futures and stocks.

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Resilience Amidst Turbulence: OMERS Achieves 2.2% Return in a Challenging Investment Landscape

OMERS Records 2.2% Return Amid a Challenging First Half of 2025

By Barbara Shecter | Published August 21, 2025

OMERS, the Ontario Municipal Employees’ Retirement System, is one of Canada’s largest pension funds. It earned a modest 2.2 percent investment return in the first half of 2025. The fund worked through a tough global economy. It faced uncertainty. It had major exposure to the United States.

Navigating a Difficult Market Landscape

OMERS gained $3.1 billion between January 1 and June 30, 2025. This gain raised its net assets to $140.7 billion. Global economic instability and volatile markets hit it hard. Still, the fund stayed positive in public and private investments.

More than 55 percent of its assets are in the U.S. This market felt shocks from recent global trade policy changes. The Trump administration’s tariffs made things worse. These factors made investing very hard. OMERS CEO Blake Hutcheson said this environment was especially challenging.

“OMERS had a positive start in what was a particularly challenging environment for investors,” he said. “We look at short-term problems while working in both public and private investing. Our team finds opportunities that add value now and later.”

Currency Impact and Hedging Strategies

Currency shifts also played a role. The U.S. dollar fell by over five percent in the first half. This drop hurt returns, even with some hedging in place. The change contributed a -1.2 percent effect to the overall numbers.

Yet, hedging was very helpful. Jonathan Simmons, OMERS’ Chief Financial and Strategy Officer, said, “Our active choice to hedge currencies raised returns by almost one percent. These moves protected portfolio value.”

Investment Performance Across Asset Classes

Over the past five years, OMERS earned an average annual net return of 8.7%. Over ten years, the return averaged 6.9%. In total, gains reached about $70.2 billion.

In early 2025, infrastructure and public equities drove returns. Six out of seven asset classes, including credit and bonds, added positively. However, private investments—especially private equity—fell, with a -1.3 percent performance.

Simmons explained, “Uncertainty in the global marketplace stops private investment valuations. Private equities and real estate have seen fewer transactions.”

Real Estate Portfolio: Signs of Recovery Amid Market Pressures

Real estate makes up about 15 percent of OMERS’ portfolio. This segment earned a 1.1 percent return in the first six months. Many Canadian pension funds suffer because office buildings struggle. Remote and hybrid work since COVID-19 hurt demand.

OMERS stays hopeful for real estate. The fund said, “Results were supported by strong operating fundamentals, especially in office and hotels.” This suggests that the market may stabilize soon.

Legal Actions Related to Retail Property Leases

Oxford Properties, the real estate arm of OMERS, has started legal actions. These actions deal with lease agreements from the insolvent Canadian retailer Hudson’s Bay Company. In early August, Oxford filed a court document. The document opposed shifting leases to an untested entrepreneur. It warned that such moves could hurt asset stability, reputation, and performance.

The filing stressed that keeping the portfolio stable is crucial. A decline could hurt the pension fund and its millions of beneficiaries.

Looking Ahead

OMERS moves through a complex investment scene. Its challenges come from economic and geopolitical issues. Even with modest gains in the first half of 2025, its diversified strategy and active management aim to build long-term value for beneficiaries.

Contact:
Barbara Shecter
Email: bshecter@nationalpost.com

This article is part of ongoing coverage by the Financial Post on Canadian pension funds and investment markets.

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EIA’s Disappointing Natural Gas Storage Report: What It Means for Prices and Traders

EIA Natural Gas Storage Build Misses Estimates, Influencing Market Dynamics

The U.S. Energy Information Administration put out its latest Weekly Natural Gas Storage Report on August 21, 2025. The report shows a build of +13 billion cubic feet in working gas. Analysts had expected a build of +22 billion cubic feet. Last week, the build reached +56 billion cubic feet.

Current Inventory Levels

Natural gas stocks now sit +174 billion cubic feet above the average of the past five years. Stock levels are -95 billion cubic feet lower compared to last year. The numbers show a shift in supply trends.

Market Reaction and Outlook

After the report came out, natural gas prices moved higher. Traders saw the smaller build as a sign that the storage market might change. The market now sees a chance for short-covering.
Prices have been under pressure since mid-July. Even if supply stays high, the recent data seem to give a small lift. Prices try to settle above the $2.80 mark. If they clear that point, they may rise toward the $3.00 to $3.05 range. The current strength index shows room for short-term gains.

Demand and Weather Factors

Weather forecasts now predict cooler days ahead. Temperatures should drop soon. This drop may trim natural gas use in the near future. Even though current use stays high, fading demand may hold back price gains.

Summary

  • Storage Build: +13 Bcf (short of the forecasted +22 Bcf)
  • Inventory Levels: +174 Bcf above the five-year average; -95 Bcf below last year
  • Price Reaction: Natural gas prices rose after the report; they now try to break the $2.80 mark
  • Outlook: Prices may rise toward $3.00-$3.05 if momentum holds, but cooler weather might slow gains

Investors and traders watch new reports and weather changes carefully. These factors shape the natural gas market in the coming weeks.

About the Author: Vladimir Zernov is an independent trader with 18 years of experience in stocks, futures, forex, indices, and commodities. He studies both long-term trends and short-term market changes.

For more economic events and updates, visit the economic calendar.

Disclaimer: The article provides information only and is not trading advice. Conditions in the market can shift fast. Investors should do their own research and talk with a financial advisor before trading.

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US Jobless Claims Surge: Manufacturing Declines and Inflation Concerns Emerge

US Jobless Claims Increase Amid Weakening Regional Manufacturing and Rising Inflation Pressures

Date: August 21, 2025
Author: James Hyerczyk

Recent US numbers show the link between rising jobless claims and slowing growth in manufacturing. Labor market data now joins manufacturing figures in pointing to a softer economy. Traders worry as the Federal Reserve reads these signals when it sets its next steps.

Rising Jobless Claims Signal Cooling Labor Market

Initial US claims reached 235,000 for the week ending August 16. This number beats forecasts of 225,000 and sits at the highest level since June. The rise builds week after week. Continuing claims now total 1.97 million; they top past expectations and hit a peak last seen in November 2021. These signs tie more workers to unemployment benefits. They also connect weak labor demand with possible market shifts ahead of a Federal Reserve meeting. The data keep both traders and analysts alert.

Manufacturing Sector Outlook Deteriorates

The August Manufacturing Business Outlook Survey shows manufacturing losing ground. The overall activity index falls from 15.9 to -0.3. New orders sink into negative figures at -1.9 for the first time since April. Shipments drop to 4.5, while the employment index falls to 5.9, yet it still hints at some hiring.

A slight rise in the average workweek cannot mask the decline in new orders. Seventy-four percent of companies report no changes in employment, while only 16% see more workers. This pattern ties low order levels to weak regional production in the third quarter.

Inflationary Pressures Remain Elevated

Prices keep rising as manufacturers face higher bills and costs. The prices paid index jumps by 8 points to settle at 66.8, a level unseen since May 2022. Meanwhile, prices received by manufacturers grow to 36.1. Firms now expect 12-month cost rises to reach 4.1%, up from 3.8% back in May.

More than half of the companies expect costs to rise over the next six months. Seventy-one percent see competitors raise prices soon. Even though forecasted wage growth slows from 4.0% to 3.5%, high input and output price expectations hold inflation high.

Market Implications: Cautious Sentiment on Economy and Fed Policy

The mix of rising unemployment claims, soft manufacturing orders, and ongoing inflation yields a mixed outlook. Firms keep a positive view for the future even as current figures show slowing growth. Analysts see these links as a sign of trouble for US equities and industrial stocks. All eyes now turn to upcoming job reports and inflation readings to fix views on Fed moves in this shifting scene.

About the Author

James Hyerczyk is a skilled technical analyst and educator based in the US. He brings over 40 years of experience with market charts and price trends. He has written several books and knows the futures and stock markets well.

For ongoing economic news and analysis, visit FXEmpire’s Economic Calendar and Market Forecasts.

Disclaimer: This article serves for educational and informational aims. It should not stand as investment advice. Be sure to do your own research and talk with financial experts before taking any action.

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