Is Stagflation Possible? Yes.

What’s in Today’s Report:

  • Is Stagflation Possible?  Yes.

Futures are little changed ahead of this morning’s jobs report.

Economic data underwhelmed overnight with Japanese Household Spending falling –3.2% while German Industrial Production missed estimates (-1.3% vs. (E) 0.5%).

On COVID, headlines remain net negative as cases continue to rise and analysts look for any signs of a loss of economic momentum (so far there’s nothing concrete).

Today the focus is on the jobs report and expectations are as follows:  Job Adds:  900K, UE Rate:  5.7% and Wages: 0.3% m/m and 3.8% y/y.  Again, the biggest risk to markets is for a “Too Hot” jobs number that shifts the tapering timeline, and if that occurs we should brace for volatility.