US: Growth appears to have fizzled - BBH

Research Team at BBH, suggests that last week's US retail sales and yesterday's industrial output figures are disappointed and what looked to be such a promising quarter in terms of growth appears to have fizzled.

Key Quotes

“Economists are no longer confident that the three-quarter streak of sub-2% GDP prints will be snapped. 

It is tempting to attribute this disappointment to the dollar's pullback, but such logic needs a middle term, and that is changed expectations of Fed policy.  That is the missing link, so far.  Net-net, and with little volatility, the December Fed funds futures contract is unchanged since October 4, and implies a slightly higher chance of a hike than at the end of September.  Still, US yields have softened somewhat.  The two-year note yield is seven basis points off last week's high.  The 10-year yield is five basis points below yesterday's four-month high.”