Top-of-mind economic news as we start the week:
— The U.S. credit rating was downgraded by Fitch Ratings to AA+ citing political instability; of the three major rating firms only Moody’s still has U.S. debt rated as AAA (S&P downgraded to AA+ in 2011).
— The U.S. economy added 187,000 in July, lower than expected; unemployment is just 3.5% (lowest since 1969) and wages are up 4.4% over the past year.
— Earnings for S&P 500 companies in Q2 2023 are down just over 5% from a year ago (with more than 80% of companies reporting), biggest drop since 2020.
— Net investment in China has turned negative, with foreigners investing just under $4.9 billion in China in 2nd quarter 2023 and the Chinese investing $34 billion abroad.
— A global framework for ESG/sustainability reporting was announced by the IAASB; can work with standards developed by the U.S., Europe and other regions.
