Independent Strategy

Macro Matters

September 2021

Independent Strategy Blog: Macro Matters

Google activity data through to 17th remains positive, with none of the anxiety present in markets transmitting into the real economy while all the fuss about the Delta variant also seem to be having minimal impact in the real world – a function of the hugely successful vaccine programmes that continues to rollout globally and has reached effectively full coverage in nearly all of the major economies.

Google activity data through to 10th September shows a continuing pick-up in activity, underpinned by a continuing rise in mobility.  Again, leading the drive higher has been Europe, notably Germany and Spain, but France, Italy and the UK also registered decent improvements.  The bounce over the last couple of weeks is really a function of the ending of the summer holidays and start of the new school year.  But economic activity is also looking fairly solid too.

Labour market growth slowed a little more than expected in August, amid some disruption to the services recovery from the Delta strain.  But there were still +235k jobs added (mkt +750k) and we saw upward revisions to prior months, so the net impact was still positive, leading to a further decline in the unemployment rate to 5.2% from 5.4% and the U6 rate dropped down to 8.8% from 9.2%.  The participation unchanged at 61.7%.  Govt payrolls shrank a little after recent strong gains (-8k) but manufacturing continued to grow (+37k).  Weekly hours were 34.7 from a downward pay revised 34.7, which by itself remains elevated from its pre-pandemic range.

Google activity data through to 27th August showing some stabilisation.  The overall picture does not look too dissimilar to last summer when economies were operating relatively normally between the first and second waves.  The picture for economic activity remains more positive than for overall mobility, as travelling habits and restrictions in some places continue to crimp that side of things.  But as we’ve seen this year that hasn’t stopped the overall economic recovery from continuing.

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