The trend is still for healthy productivity growth between 2% and 2.5%, and unit labor costs are expected to only slowly rise over the coming year.
Right now, we're seeing upward momentum in long-term rates, especially with new inflation worries. Long-term rates have been so low for so long compared to where they'd normally be in the business cycle -- at some point a correction is necessary.
Today's sharp decline in jobless claims is great news.
From the tone of his testimony today, it's obvious he sees a pretty strong economy.
If the Fed continues to raise rates, adjustable-rate mortgages will continue to get pinched. That's going to take people who are stretching to buy homes off the table.
The longer-term up-trend in the index is intact. Inventories are extremely lean, global growth is firming and there are mounting unfilled orders.
