Tausi Insider

People shop for clothing at a Costco store in Monterey Park, Calif., on Nov. 22. FREDERIC J. BROWN/AFP/Getty Images U.S. consumer spending barely rose in November, while annual inflation increased at its slowest pace in 13 months, but demand is probably not cooling fast enough to discourage the Federal Reserve from driving interest rates to higher levels next year. Slowing economic activity heading into 2023 amid rising borrowing costs was also flagged by other data from the Commerce Department on Friday showing a modest gain in orders for locally manufactured capital goods last month. The U.S. central bank is trying to slow demand for everything from housing to labor as it fights to bring inflation back to its 2 per cent target. “The economy is moving in the right direction from the Fed’s perspective, but not quickly enough,” said Gus Faucher, chief economist at PNC Financial in Pittsburgh, Pennsylvania. Consumer spending, which accounts for more than two-thirds of U.S. economic act...

A now hiring sign on a storefront in Washington, on Oct. 7, 2022. Anna Moneymaker/Getty Images The number of Americans filing new claims for unemployment benefits unexpectedly fell last week, pointing to another month of solid job growth and continued labour market tightness despite efforts by the Federal Reserve to cool demand for workers. The weekly jobless claims report from the Labor Department on Thursday likely does not change expectations that the U.S. central bank will further scale back the size of its interest rate increases next month. It, however, poured cold water on financial market hopes that the Fed would pause its fastest rate hiking cycle since the 1980s, which had been fanned by a slump in retail sales in December and a retreat in inflation. “A low level of layoffs indicates that demand for workers remains strong and labour market conditions remain tight,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics in White Plains, New York. “Facing work...