Macro Briefing: 25 November 2024

US growth in business activity strengthened in November, according to PMI survey data. The US PMI Composite Output Index, a GDP proxy, rose to 55.3, a 31-month high. “The business mood has brightened in November, with confidence about the year ahead hitting a two-and-a-half year high,” says , Chris Williamson, chief business economist at S&P Global Market Intelligence. “The prospect of lower interest rates and a more probusiness approach from the incoming administration has fueled greater optimism, in turn helping drive output and order book inflows higher in November.”

Trump promised on the campaign trail to cut US energy costs in half within 18 months, but analysts are skeptical such a dramatic downturn for prices is possible. “It is not completely impossible, but it is highly unlikely,” says Edmund Crooks, vice chair of the Americas for Woods Mackenzie, an energy consulting firm. “The US is part of a well-integrated oil market, and the number one factor that drives prices is global conditions. Is it possible that U.S. production would rise enough to cut prices in half in a sustained way? No. That’s highly unlikely.” Jason Bordoff, founding director of the Center on Global Energy Policy at Columbia University’s School of International and Public Affairs, adds: If crude oil prices did fall by half, “at that price, you’re shutting down production” as oil companies react to the dramatic change in the supply/demand calculus.

Tax cuts will be a priority president-elect Donald Trump’s nominee for US Treasury secretary, Scott Bessent, tells The Wall Street Journal. He will also focus on enacting tariffs reducing government spending, and “maintaining the status of the dollar as the world’s reserve currency,” he says.

US consumer sentiment was little changed in November, edging from October. “In November, sentiment extended a four-month stretch of consecutive incremental increases,” reports the University of Michigan via its survey.