James Knightley, the chief international economist at ING, thinks that the data flow over the past five weeks has clearly signaled a deceleration in the U.S. economic activity.

• “What started out as a manufacturing downturn resulting from weak external growth, the headwinds from a strong dollar and the uncertainty and barriers to trade caused by the US-China tariffs, is starting to spread to the services and consumer sectors.
• The ISM non-manufacturing index is heading lower, payrolls growth is slowing and retail sales fell sharply in September. With the outlook for corporate profits deteriorating and the durable goods orders report signaling a likely contraction in investment spending in both 4Q19 and 1Q20, it is difficult to see where the major positive growth drivers are right now.
• The one area that is performing well is housing, buoyed by the plunge in mortgage rates and the fact that the unemployment rate remains low. However, the durability of this strength is questionable given the apparent slowdown in hiring and wage growth.”