that is ugly, julia coronado. that is not so great.the ppi that feed into the pce and there is growing divergence. health care is one of those areas of divergence. i'm wondering if that low print is driven by the health care inflation, which has been low in the ppi and pce. alix: we are also seeing christine lagarde taking the helm of the ecb in her first news conference. not her first news conference altogether. everyone excited to look at her first news conference. she is getting settled after the ecb does nothing. initial jobless claims coming in at 252,000. are we out full employment or not? julia: it depends on labor force participation, which has been trending higher. prime age people coming back to the labor force. that means we can sustain this pace of job growth without much in the way of wage pressures. when we take a look at the weaker producer price index, how much of that is china? is that still conversation? julia: it is a conversation. they have headline inflation from underlying agricultural issues. we demand translates

. >> for more on the 2020 fed outlook, let's bring in julia coronado, founder of micropolicy perspectives llc julia, good to have you back >> thank you >> wherever the committee is this much in license plaalignme when surprises often come. do you think it's going to be as mild a fed backdrop as we think? >> it's a good baseline expectation. i think it's a solid way to start. we're certainly ending the year on a high note, both in the markets and in the economy the latest labor market data was fantastic. but we do have a lot of uncertainties, so the trade war was one that steve mentioned but the origin impetus for the global slowdown was china reigning in its excess credit growth and china is dealing with a lot of bad loans and some bank failures and so far, they've managed to keep the train on the tracks with their economy but it's far from a foregone conclusion this is a lot of uncertainty for the chinese economy, which is the bellwether for the global manufacturing cycle. so that's a big uncertainty. fading fiscal stimulus is one in the u.s. the budget deal that was passed is fine, but