jonathan: i would like to give mike mckee the final word going into payrolls. e thing you are looking for? mike: job growth. the fed is looking for a sequential slowdown. we could look at the unemployment rate and participation rate, but the fed has gotten to the point where they don't think the precipitation -- the participation rate is going to go up more. let's look at the headline number. one thing mary daly said is, we are data-dependent, and data is a plural word. they are not just looking at pce, they are looking at every other inflation measure, and the university of michigan. they want -- what was the word? totality. jonathan: the totality of the data. jeffrey rosenberg is going to be with us as well to break down that number in about four and a half minutes. here is how the stage is set. the equity market not doing much at all all morning. foreign-exchange as well. you're looking for 255,000. unemployment, 3.7%, in-line with the previous month as well. futures up by about .1%. the jobs number, up next. ♪ jonathan: 10 seconds away from the payrolls repo

mike, appreciate it, bloomberg's michael mckee. get more market reaction, u.s.pi data, the moneta chief investment officer is here. what do you deal when this is going harder, faster and longer? aoifinn: if you look at the numbers from lael brainard, they're looking under the hood come out the transition of their tightening is having an effect on the different sectors. they're looking at the retail sector come out housing sector, maybe an area that is looking at the mortgage rates that have doubled over the course of the year. they want to see inflation coming down across the board. they want to see it happening first and it is starting to happen. architect to understand that. -- markets have to understand that. guy: i appreciate that we are seeing it moderating in important areas. the problem is we are now seeing it pick up in other areas, mainly the service sector where it is more sticky, problematic and more difficult to get rid of. isn't that the mission we are looking at -- sorry, the transition we are looking at now into services inflation and that could b

as soon as you see unemployment rise, some of the things that mike mckee will talk about, as soon ashe economy starts to weaken significantly, that is when the federal reserve can start to jawbone, our next move will be ease. then the market will adjust to that and ease financial conditions fast. alix: good conversation to set us up on monday. thank you very much. coming up, we will continue the conversation with ellen hayes and. financial instability. that scenario that ira is laying out is happening on a microlevel. softer ism manufacturing number, but the s&p is up over 1.5%. the dollar drops and yields are lower as you have buying coming in all across the curve. bad news, good news? this is bloomberg. ♪ alix: markets up on 1.7%. the two in the five-year fall by 20 basis points across the curve. which brings us to the question of the day, financial instability? joining us is ellen hazen from fl putnam investment management. there are so many cracks appear that can be quite dangerous. are we in a moment where financial stability could be questioned? ellen: we are concerned that the

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i want to go back to mike mckee.f you are just tuning in, core level of cpi hitting its highest level in, 6.2%, year-over-year higher than expected, even the headlines were higher than expected, lower than recent highs. michael mckee has been parsing through the details where we talked about how used cars have declined but new ones have continued to rise in terms of pricing. what are some of the other details that you think will shape the conversation, mike? mike: i think it is in general the overall number of things that went up, the breakdown of everything in the cpi, most everything under the apparel category fell. it's the only thing that shows anything like that. services up six point 7% for the year. not what the at once to see driving the core higher and part of the problem is they haven't yet been able to get a cap on expectations from businesses raising their prices. we will see if that starts to come through and with seth as you were talking about the natural gas issue is probably going to come back and wri

let's get to mike mckee to break down this data. the data simmers and we look at the cpi, how relevant is this data? mike: it is not particularly relevant because the cpi does not see the direction of cpi. the middle man in the way. but it does tell us about inflation pressures in the pipeline and telling us there are still inflation pressures in the pipeline. it is not going to make anybody happy. cpi is the big number of the week. it will probably not change the mind of anyone at the fed unless there is a major surprise. they are locked in on the idea of 75 basis points in november but it will give us breakdowns of where inflation is still heavy. that is going to be important to the way the fed thinks about what it has to do. it has to be able to -- it has to make sure that monetary policy will have an impact. gasoline prices, things like that. lisa: a couple of conversations i've been having, there is a growing fear we have not seen peak inflation. certainly court will continue to gain. talking about cpi. given these numbers comin

mike mckee runs into the studio to get prepared. the s&p 500 about positive, up by 0.05%. yields higher by five basis points in the united states. what is the data? michael: initial jobless claims, 217 thousand. that compares to 214,000 than the previous week. jobless claims telling us the labor market is in good shape. gdp third-quarter gross domestic product for the first release, 2.6%. which neatly splits the difference between the atlanta fed three point 1% gdp and the bloomberg consensus of two point 4%. the first two quarters of the year, we saw contraction. i have not seen yet whether that has been revised. personal consumption, waiting on that number. i will have to look into this. personal income, personal consumption. we will look for it in a second. gdp price index, not really widely followed because it is a quarterly number is 4.1%. durable goods orders, up .4%. zero point 6% was the consensus. x transportation down way 5%. capital goods orders down .7%. that tells you businesses are starting to pull back because of high

mike mckee brexit out -- michael mckee breaks it down.in the month of september. last month they were up .2%. you have a point -- a .1% gain. retail is up a healthy .4%. he autos, gasoline, the things that are coveted in other areas of gdp. looks like a healthy gain of 4% -- gain of .4%. let's take a look at what moved. tessa lane is likely to be down. gasoline stations were down 1.4%. that is not as bad as the 5.2% decline the prior month. looking at motor vehicles, down .4%. gas and motor vehicles are dragging that headline number down. food is up .4% on the month. health stores up .5%. general merchandise is up .7%. general stores, .3%. retailers decline in august but rose have been percent -- rose .5% in september. a fairly wide range of solid gains in retail sales. economists have been pointing to numbers from the major banks showing people still have significant deposits from last year's stimulus and still using credit cards to buy things. right now the consumers are hanging in there, also probably a function of the fact that job gr

. >> i really like mike mckee's question in that regard. what they are trying to do is avoid the mistake of an early 1980's under volker. they stopped hiking rates too soon and had to come back and to even more. is a dollar just going to keep going higher and higher until we know that the fed has gone to the point where they can't hike anymore? is there some sort of natural peak for the dollar now? >> the dollar is already off most of the charts. unless you want to extend back to things like the plaza accord. when i got stronger against what was in the deutsche bank and japanese yen. it is hard to see a peak dollar coming just yet. the concern has to be that first of all you get u.s. yields rising. u.s. yields rising and staying high. you get a recession, what happens in a recession? initially the dollar goes up. i think, though, if you do get a recession, that would be about when you would see the dollar peak. because at some stage, you would get serious pricing for rate cuts. you might start to see strength come off. but it will be someti

mike mckee tells me jolts really matters.e -- the bottom line, for me, is simple. we are arguing about the implement of people in america, i think it is absurd. jonathan: it is worse than that. i think it is worse than that. this is going to get difficult for this fed, something we have talked about for a week. if on a plymouth starts to go in the wrong direction over a long period of time and this fed is hiking interest rates, the communication from the fed gets harder. -- this labor market is cracking over the past month. jonathan: nobody wants to see people lose their jobs. lisa: how do you see normalcy to inflation, it puts the fed between a rock and a hard place. communication is going to be fraught. tom: i think there is a underestimation of the technology overlay, the entrepreneur cheryl -- entrepreneurial spirit. it is systemic uncertainty right now, but to focus on conceptualization of it like it is a parlor game does no service. i think companies will come with a vengeance. jonathan: and will be data-dependent. the

mckee. what are the main takeaways from this imf report? mikethe markets are performing, you could blame your next guest. imf with a downbeat view of what will happen to the global economy in 2022-2023. pierre-olivier gourinchas, the chief economist, saying what you just said, the worst is yet to come. for many people, 2023 will feel like a recession. the imf sees unusually large risk out there in the accompanying 12 months. russia, with the war in ukraine, continues to destabilize the global economy, the imf says. inflation peaks in late 2022. . china lockdowns and the weakening the risk of missed calibration. too many central banks raising rates too high, risks to the economy. the broad economic outlook for gdp shows the u.s. growing at 1.6% this year, down .7% from the july forecast. only 1% next year. if you look at the eurozone and the u.k., almost no growth at all. inflation in the u.s. will drop dramatically from 8.1% this year to 3.5%. in the euro zone and the u.k., little progress on inflation, which means central banks to to keep at it

michael mckee is here with that data. mikee markets and for economists to figure out how this fits into third-quarter growth. september advance goods trading balance. a lot worse than anticipated. $92.2 billion. i guess you could call that down, wider than the $87.3 billion in august. retail inventories coming up .4%. wholesale inventories, 0.8%. both are lower than the prior month but still a gain. when you look at retail and wholesale inventories, they are running way ahead of where they were in pre-pandemic years. that does suggest we will have some more growth added to the third-quarter numbers. it also takes away from the future. it may give us some break on inflation if we see retailers cutting prices as they have been to get rid of their stocks. housing, the mortgage bankers association, mortgage application index falls 1.7% in the last week. that is down from the 4.5% drop the week before. when you look at the overall index, it is now the lowest since 1997. people are really bailing out of the housing market. hard to s

michael mckee is with us here to break down the numbers as we get them. mike it looks like a little bit less on expectations, down from last month. 8.1% decline on a month over month basis on housing starts. 1,439,000. the expectation was for 1,461,000. building permits, coming in at 1,564,000. that is better than expectations. they revised it here. 1,500,042. it shows that builders have some business left to do. i was going to say some confidence, but we saw the homebuilders index yesterday fall to the lowest since the 2008 financial crisis brought on by housing. it doesn't look like they have a lot of confidence but they have a lot of backlogs, are pulling permits, would put some of those permits into the ground. lisa: you are seeing the two year yield breakout to the newest ties going back to 2007. you can see the dollar gaining, the opposite effect. what is good for stocks is good for bonds. what is bad for stocks is bad for bonds. this really speaks to what you been talking about which is how much are people looking at housing, the resilience. .7% right n