Ian Shepherdson Market Quotations

We remain of the view that the Fed's near-term objective is simply to support the stock market until consumer and business sentiment improves,

No doubt bears will highlight the rise in continuing claims, up another 29,000, but we are unmoved: A rising ratio of continuing to initial claims signals accelerating productivity growth, not a shaky recovery, ... Labor market conditions are improving -- but we still expect a soft payroll report Friday.

My guess is that is that at the moment these numbers seem to be supporting the slow down story, ... But the market is pretty much ignoring it and moving on.

My guess is it won't be very exciting because he already told us three weeks ago what he thinks. He's certainly not going to say anything that suggests the Fed might be thinking about not cutting rates as soon as the market thinks but I don't think he'll want to give the impression that they're going to slash rates even more aggressively.

No doubt these numbers will be taken by the market as a clear sign of a softening housing market and, by implication, an indication that higher interest rates are biting. We are much more skeptical: housing starts lag home sales, which have been depressed in recent months more by lack of inventory than by higher interest rates.

There is no chance of a spontaneous slowing in home sales. The market will soften if -- and only if -- mortgage rates rise significantly.

It is beginning to look as though there has been a real improvement in the labor market at the start of this year.

Overall, the labor market is improving, but progress is still slow,

There is, in short, no sign that the housing market has turned down. The lack of supply of existing homes simply means that prices will rise more quickly -- and with mortgage rates at just over 8 percent, there won't be any slowdown in home sales anytime soon.

There is, in short, no sign that the housing market has turned down, ... The lack of supply of existing homes simply means that prices will rise more quickly -- and with mortgage rates at just over 8 percent, there won't be any slowdown in home sales anytime soon.

The data confirm that the labor market is still not generating the sort of cost pressures many analysts expected with 4 percent unemployment.

Doubtless these numbers will be followed by a rash of commentary to the effect that rumors of the death of the housing market are greatly exaggerated. This would be the wrong conclusion to draw. It is not possible for sales to trend down and starts to trend up.

The trend in sales is probably not as weak as this seems to suggest, but there is no question that the condo/co-op market is slowing much more dramatically than the market for single-family homes. Even in the latter case, however, sales have fallen more than 10% from their summer peak.

These are spectacular numbers and confirm that the labor market is not at the moment the source of anything that could be plausibly described as inflationary pressure.

It would be very helpful if the drop in confidence in June marked the start of a new trend, but with the job market still very tight we cannot yet be confident about this.

After the attack on Pearl Harbor, the New York stock market fell 5 percent over two days. As the United States mobilized and expressed its resolve in the ensuing days, the stock market came back.

This is slightly baffling, given that existing home sales have been strengthening, ... It may be a reflection of caution on the part of builders, who have been reluctant to keep pace with sales because of fear the market strength will not last.

It signals that the labor market has now moved again to center stage in the Fed's analysis and policymaking process.

The labor market is tightening, but the tightening is not accelerating.

The message from these claims numbers is strong and clear. The labor market is extremely tight.

The Fed's minutes do not change the near-term outlook for policy despite the strong market reaction. Clearly there is some debate as to how much further tightening will be necessary, as the minutes say the number of hikes will likely 'not be large,' but 'large' is undefined. This does not read like a Fed where everyone is looking for a reason to stop.

The Fed can and will be much more of an active player in the stock market until it turns the corner,

In the short-term, these data will reinforce the impression that the housing market is proving resilient in the face of higher mortgage rates, ... it will not last, because the current trend in home sales is not high enough to support this rate of house building in the medium-term.

His conclusion, in essence, is that much of the productivity explosion of recent years is permanent, but there is a risk that there is significant cyclical element too. Unfortunately, this leaves us none the wiser as to his intentions at the next (Federal Open Market Committee) meeting.

Behind the enormous distortions caused by the hurricanes, the underlying state of the labor market has continued to improve.

If claims remain anywhere near this week's level, they will send a very strong signal that the labor market is tightening.

This hugely strong report will doubtless be cited as evidence that the housing market is not slowing. However, the extremely warm January weather surely distorted these data, just as it boosted retail sales and depressed industrial production.

The housing market is clearly on a roll again, despite the -- probably temporary -- dip in confidence.

The headline was pulled down by slightly bigger declines in gasoline, natural gas and fuel oil prices than we expected. Core PPI is now up just 1.7% year over year, down from May's 2.8% peak. It will slow further in the wake of the slowing in raw-materials prices, but the Fed cares much more about the labor market than PPI.

The improvement in the stock market is allowing the hugely favorable monetary and fiscal environment to do its work -- just as it was in the spring before the stock market melted down,

The drop in stock prices is no excuse to beginning cutting rates, as some in the market desperately want to believe, ... Given where oil prices are and given what the fundamentals still suggest, I don't see the Fed doing anything for the time being.