The Fed’s latest assurance that the world’s leading central bank is poised to raise rates cited corporate fixed investment “increasing at solid rates in recent months” as a key metric giving them a green light. For those that are interested in reality here is picture of that “increasing” trend. If only the facts would do what Yellen and company theorize.
The Economic Cycle Research Institute explains:
“…the squeeze in profit margins has weighed on investment, as year-over-year fixed investment growth slowed to a five-year low in Q3…If the Fed is counting on investment growth holding up, it may well be disappointed, making their plans for a rate hike cycle look increasingly ambitious.”