Main US indexes rally; Dow out front, up ~0.9%
S&P 500 sectors mostly green; Consumer discretionary leads
Euro STOXX 600 index ~flat
Dollar, crude lower; gold down ~0.4%; bitcoin ticks up
US 10-year Treasury yield rises to ~4.30%
Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com
WHY NOISY ECONOMIC DATA COULD COST THE ECONOMY
Faulty economic data isn't just a headache for policymakers — it can be costly when it comes to assessing the health of an economy as well.
Goldman Sachs estimates that if noisy statistics lead to the central bank making the wrong move, such as hiking rates when it shouldn't or delaying a cut, the GDP hit could reach 0.1% over two years, even if the error is corrected within a quarter. That's more than the annual budget of most statistical agencies.
Concerns about data reliability have grown after a string of high-profile missteps at statistical offices worldwide, worries that deepened when President Donald Trump fired BLS chief Erika McEntarfer earlier this month following a weak July jobs report and steep downward revisions to May and June payrolls. Goldman points to three drivers of weaker data quality: post-pandemic volatility that distorts seasonal patterns, stagnant funding for statistical agencies, and a sharp fall in survey response rates since COVID-19. Evidence of actual deterioration in global economic data is mixed, Goldman says, but discrepancies between household and payroll employment measures have widened, standard errors in releases have risen, and market surprises are increasingly out of step with underlying economic activity. The BLS revised May and June payrolls down by a combined 258,000 jobs were the biggest non-COVID-era two-month drop since the 1980s, analysts at Standard Chartered note. They add that first-release payroll estimates now capture responses from just over 40% of surveyed firms, down from about 60% pre-pandemic. That leaves early readings vulnerable to sampling bias, which historically tends to overstate job growth during downturns. For central banks like the Federal Reserve, which lean heavily on preliminary labor data, this bias can mean policy lags and sharper course corrections later.
Both Goldman and StanChart suggest giving more weight to revised datasets and bolstering statistical capacity to ensure policy decisions are built on the firmest possible footing.
(Joel Jose)
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EARLIER ON LIVE MARKETS:US STOCKS RALLY, BUT STRUGGLE TO HOLD THE HIGH GROUND CLICK HERE
U.S. STOCK FUTURES RALLY AFTER ROUGHLY IN-LINE CPI DATA CLICK HERE
RUSSIAN GAS TAPS TO EUROPE UNLIKELY TO FLOW ANYTIME SOON CLICK HERE
THE FED: IT'S COMPLICATED! CLICK HERE
TARIFF U-TURN STEADIES GOLD, UBS KEEPS $3,500 VIEW CLICK HERE
STOXX NUDGES UP, BUT STUCK IN RANGE CLICK HERE
BEFORE THE BELL: EUROPEAN FUTURES EDGE UP CLICK HERE
TRUCE EXTENDED, ECONOMIC DATA NEXT CLICK HERE
EarlyTrade08122025 https://tmsnrt.rs/3HsLq2R
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