Economic Update | September 2024

This month, Ginger Chambless, Head of Research for JPMorgan Chase Commercial Banking, provides perspective into the latest stats on labor, inflation, commodities and other factors affecting the economy.

Economy: Manufacturing indicators remain relatively downbeat

Overall manufacturing activity has been hurt by the higher interest rate environment over the past few years. Order growth for durable goods has been moderating.

Labor: Some indicators suggest broad labor market momentum is cooling

Job gains have become increasingly concentrated in a few sectors, as reflected by declining employment diffusion. Slower hiring and fewer open jobs means labor needs are met for more industries.

Inflation: Remains on a gradual path towards the Fed’s 2% target

Restrictive monetary policy, including a decades high Fed Funds target range, has been warranted to rein in inflation over the past couple of years.

Commodities: Volatile performance across categories

Gold prices inched up to a new all-time high, with markets pricing in near term rate cuts across the globe and elevated geopolitical tensions. Industrial metals and oil prices are up, ag prices are down.

Interest rates: “The time has come” to adjust interest rates

With the Fed essentially confirming its plan to reduce rates at the September meeting, the amount of cuts at upcoming meetings will depend on incoming data, including inflation and labor reports.

Credit: Environment for the supply and demand of loans is stabilizing

Following a period of intense tightening of lending standards and drop in loan demand in the wake of the 2023 market disruption, the latest SLOOS report showed smaller shifts for both metrics.

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