Is Volatility in Macro Data a Concern?

| Multi Asset

Our proprietary US Growth Nowcaster has recently exhibited higher volatility than usual and a downward trend. While this is an evolution worth monitoring, macro data has tended to be quite volatile over the past year. For example, US indicators plunged to unprecedented lows in March 2020 as containment took hold. When it ended, these same indicators rebounded in proportion to their fall. Since January 15, a spectrum of indicators have begun to show signs of erosion. For example, the ISM manufacturing index’s “new orders” component reached highs in early January (67.5) not seen since the recovery of 2003. Such levels are generally unsustainable in the medium term, and it has since begun to normalise rapidly, falling back to 61.1 in early February. Therefore, despite the volatility in macro releases, we are not overly worried. The economic outlook for 2021 remains positive.


Is Volatility in Macro Data a Concern?
Source: Bloomberg, Unigestion. Data as at 8 February 2021.

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