Location Strategy Chartbook 021724

Location Strategy Chartbook

The rebound in productivity growth is aiding the Fed’s battle against inflation.

I enjoyed seeing so many of you at the Bisnow THE FUTURE OF DFW MASTER PLANNED COMMUNITIES event on Tuesday. It’s an incredibly dynamic market. We will next be at the THE FUTURE OF HOUSTON’S MASTER-PLANNED COMMUNITIES on February 22nd. We hope to see you there.

Productivity gains are helping in the Fed’s fight against inflation.

The market continues to scale back Fed rate cut expectations for 2024.

Nomura sees a slight acceleration in month over month core inflation.

The January CPI report exceeded forecasts, indicating a bumpy path toward the Fed’s 2% target.

Just a reminder, no one is very good at forecasting inflation: here’s the CBO’s forecast of inflation (2%) before the passage of the American Recovery Plan, and actual inflation, which peaked at 9%.

As gasoline futures indicate, inflation expectations may increase with rising gasoline prices.

WARN notices signal higher jobless claims ahead.

Millennials/Gen Z are experiencing the fastest percentage wealth gains - but they are off the smallest base.

Excess savings remain elevated for high earners.

Wages of Boomer workers who’ve stayed on the job are catching up wages of younger workers.

Mortgage applications are holding at multi-year lows.

Rate locks are also at multi-year lows.

JP Morgan thinks that shelter inflation - the increase in the price of housing will normalize in 2024.

High interest rates and mortgage rate lock-ins have pushed the probability of changing primary residence has fallen to its lowest level in 3 years.

Core services CPI climbed at the fastest pace since 2022,…

…propelled by shelter inflation, particularly owner’s equivalent rent (OER)..

The gap between OER and rent was unusual in January.

Homebuilder sentiment improved further this month.

What’s going in the engineering department? Water and sewerage maintenance CPI soared.

Cold weather impacted January retail spending.

US centenarian population to quadruple in the next 30 years.

A few weeks ago we showed a chart that the US is now importing more from Mexico than China. This may be one of the reasons why: as a result of Ukraine-related sanctions, China’s exports to Russia are up 150%.