by Patrick Fearon-Hernandez, CFA, and Thomas Wash

[Posted: 9:30 AM ET] | PDF

Our Comment begins with our analysis of concerns over a rise in job cut announcements. Next, we examine what JPMorgan’s involvement in the Argentine bailout reveals about the evolving relationship between the private and public sectors, along with updates on OpenAI seeking a government backstop, the recent drop in Chinese exports, and the potential weakening of new EU regulations. As always, the report includes a comprehensive roundup of key international and domestic data releases.

Layoffs Rising? Market sentiment soured sharply on Thursday following a grim report on the US labor market. According to Challenger, Gray & Christmas, employers announced 153,074 job cuts in October—the highest for the month in over two decades. The report also showed hiring plummeted 35% from the previous year, reinforcing fears of a significant cool-down. With official government data unavailable, investors have reacted sharply to private data as they try to gauge the state of the economy.

• The report detailed the drivers behind the layoffs: cost-cutting was the top-cited reason, followed by artificial intelligence (AI), and general market and economic conditions ranking third. The technology and warehousing industries bore the brunt of the cuts, suggesting companies are actively shedding jobs due to redundancies and overcapacity concerns after a period of rapid pandemic-era expansion and subsequent automation efforts.
• While the massive total of job cut announcements from the Challenger report paints a stark and severe picture of the economy, it represents just one proprietary measure. Other high-frequency data suggests the labor market’s underlying health remains resilient. For instance, the latest state initial jobless claims data, gathered by Bloomberg, indicates that actual reported layoffs are still subdued despite a modest increase from the previous week.
• The recent layoff figures are undoubtedly concerning. However, the pronounced market volatility likely stems less from the data itself and more from the absence of official government benchmarks. This information vacuum forces an overreliance on fragmented proprietary reports, magnifying their impact. We anticipate a return to stability upon the release of comprehensive official data and, barring any major surprises therein, retain a constructive view of the economy’s underlying path.

Bank and Government: JPMorganChase executed purchases of Argentine pesos on behalf of the US Treasury, an action confirmed publicly for the first time by Senator Elizabeth Warren. This revelation confirms the bank’s direct role in a White House initiative to stabilize Argentina’s currency—a move that, in effect, provided a financial backstop for President Javier Milei’s administration. The case highlights a growing trend of the private sector being enlisted as partners in statecraft, blurring the traditional lines between public policy and private commerce.

• Although the specifics of the arrangement are not fully known, reports indicate that the bank’s function was to purchase Argentine pesos and subsequently sell them to the Federal Reserve Bank of New York. JPMorgan was not the only bank involved; Goldman Sachs, Bank of America, Banco Santander, and Citigroup also participated in the $20 billion currency swap lifeline.
• The coordination between the White House and the private sector comes as the government has taken on a more active role in promoting business interests abroad. Prior to the decision to help stabilize the peso, JPMorganChase CEO Jamie Dimon visited the South American nation and signed a lease in the capital as his bank looks to expand its footprint in the region.
• This event highlights the growing overlap between public and private interests as the US seeks to expand its global influence and enhance national security. While this collaboration can benefit firms through government protection for overseas expansion, it could also pave the way for outside political influence in firm decision-making, or at least create the perception of it.

OpenAI Wants US Backing: OpenAI, the creator of ChatGPT, has suggested that the US government provide loan guarantees to backstop its significant infrastructure expansion. The request arises from concerns about how the company will fund its ambitious projects, which represent over $1 trillion in commitments against only roughly $13 billion in annual revenue. While OpenAI clarified that it does not require the assistance to survive, it maintains that such government support would be highly beneficial for its growth.

Financial Plumbing Concerns: Wall Street banks continue to express concerns about funding stress as signs of tightening liquidity in the system appear. These fears are rooted in the sharp rise in short-term funding rates, particularly in the repo market, which has caused strain on the broader financial system. While this liquidity problem currently appears to have subsided, there is growing concern that the Federal Reserve may be forced to intervene to prevent a more severe market dislocation from emerging.

New Critical Minerals: The US Department of the Interior has added several metals, including copper, silver, and metallurgical-grade coal, to its list of “critical minerals,” a move that could pave the way for higher tariffs. This designation means these materials will be included in a Section 232 national security review, which can result in new import levies. The expansion of the list underscores the US government’s growing influence over the domestic commodity market.

Chinese Exports Fall: China’s exports fell unexpectedly last month for the first time since February. The decline suggests the world’s second-largest economy may be feeling the effects of US tariffs imposed in April. This could signal that China is exhausting its alternatives for circumventing those tariffs and may also point to a broader slowdown in global demand. The drop likely points to an economy losing momentum, which could force Beijing to inject fresh stimulus to bolster growth.

EU Regulatory Pullback: In an effort to enhance its global competitiveness, the European Commission is weighing a pause in the implementation of certain digital regulations. The proposal follows significant pressure from a coalition of large technology companies, the US government, and prominent European businesses. By creating a more favorable regulatory environment for tech development, the EU aims to strengthen its position relative to the US and China and attract greater foreign direct investment.

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by Patrick Fearon-Hernandez, CFA, and Thomas Wash

[Posted: 9:30 AM ET] | PDF

Our Comment leads with a critical analysis of the Supreme Court hearing on presidential tariff powers. Subsequent sections assess the economic implications of the latest PMI data and rising US household debt. Our international focus is Japan’s significant commitment to AI and semiconductor manufacturing, followed by a review of the Bank of England’s recent policy move. As always, the report includes a roundup of international and domestic data releases.

Supreme Court Tariffs: The US Supreme Court heard arguments challenging the president’s authority to impose tariffs. During the two-hour hearing, several conservative justices expressed skepticism that the International Emergency Economic Powers Act (IEEPA) could justify such unilateral action. The case was brought by a coalition of businesses and twelve states, all claiming economic harm from the tariffs. A ruling is not expected for some time, but the Supreme Court may potentially overturn the presidential action.

• Although the ruling is highly anticipated, its impact would not remove all levies. The lawsuit focuses exclusively on the legitimacy of the reciprocal tariffs from last April, a policy intended to mirror other nations’ duties. It does not, however, challenge the foundation of the broader, product-specific tariffs imposed under Section 232, which enjoy stronger statutory authority.
• A ruling against the administration would significantly hinder its trade strategy. The core of which relies on provisions that authorize tariffs against partners that do not uphold their obligations, a broad condition that encompasses both the removal of discriminatory regulations, trade barriers, and the fulfillment of promised investments.

• That said, these tariffs have effectively served as an experiment for Washington. They have proven that the US government can collect massive amounts of revenue through import taxes without causing an economic collapse. Therefore, if the Supreme Court rules that they are illegal, that ruling might not be the end but simply a trigger for Congress to pass the tariffs into permanent law.
• The removal of the tariffs could have a mixed impact on the economy. On one hand, it should provide a stimulus as firms rebuild inventory, similar to the activity observed in the first quarter. However, the immediate downside is that refunding the collected tariff revenue to the paying firms will cause a corresponding increase in government debt.

Strong PMI: Rising Purchasing Managers’ Index (PMI) readings from two key surveys signal growing confidence among businesses. The S&P Global Services PMI rose from 54.2 to 54.8, while the ISM Services PMI increased from 50.0 to 52.4. The simultaneous rise in both indexes suggests the economy retains significant momentum. In the absence of other major economic data, these PMI reports serve as a crucial alternative barometer for assessing the economy’s health, particularly as markets evaluate the impact of recent tariffs on economic activity.

• A closer examination of the data reveals the drivers behind this growing confidence. A sharp rise in new orders points to strengthening demand for services, while a concurrent increase in business activity indicates that companies are becoming busier. However, these positive signals are tempered by persistent signs of rising price pressures and a declining willingness to hire new employees.
• Respondent comments offer valuable insight into firm sentiment regarding the economy. Most firms reported that tariffs have weighed on business activity, though the intensity of this pressure — particularly concerning costs — has begun to ease. Furthermore, there were growing signs that the government shutdown was also creating problems, prompting some firms to delay planned projects.
• Overall, PMI surveys suggest that while significant headwinds persist in the economy, firms are expressing greater confidence in their ability to operate effectively despite the tariffs. This renewed confidence is largely predicated on the expectation that policy will remain relatively stable over the next few months. Assuming this stability holds, the data suggests the economy could begin showing signs of acceleration.

Households Under Pressure: Despite a robust economy, signs of strain are emerging among some households. US household debt has reached a record $18.6 trillion, with delinquency rates holding steady at a level unseen since 2011. This rising debt burden is a hallmark of a K-shaped recovery, where the financial strength of high-income households masks broader weaknesses elsewhere. While we do not expect this to weigh on equity prices in the short term, it presents a longer-term risk

Japan AI Industrial Policy: Japan’s ruling Liberal Democratic Party plans to allocate an additional $6.5 billion annually to bolster its semiconductor and AI industries. Starting in April, this funding will be sourced from the regular budget rather than a supplementary one, signaling a long-term commitment. The move underscores the strategic importance of these sectors as nations worldwide act to shield their digital economies from foreign competition. While this policy aims to strengthen domestic industries, it also risks increasing government debt.

EU Backs Down: European officials have conceded they lack the strategic leverage to quickly persuade China to lift its restrictions on rare earth exports. This admission reflects a broader Western realization of China’s dominance in this critical sector. Although the EU is pursuing a separate deal with China to ease trade tensions, its limited negotiating power is now clear. Consequently, this reality is likely to accelerate efforts by Western firms to develop their own rare earth mining capabilities.

BOE Divided: The Bank of England held interest rates steady at 4.0% at its policy meeting on Thursday, with the decision passing by a narrow 5-4 vote. This pause reflects the central bank’s ongoing challenge in balancing slowing economic growth and labor market weakness against persistent inflationary pressures. Given the tight vote, there is a growing likelihood of a rate cut at the next meeting. Such a move would aim to boost growth but could also lead to a depreciation of the pound sterling (GBP) against the US Dollar.

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by Patrick Fearon-Hernandez, CFA, and Thomas Wash

[Posted: 9:30 AM ET] | PDF

Our Comment begins with an analysis of Tuesday’s electoral contests. We then delve into the factors driving the recent cryptocurrency sell-off. Further coverage includes the continuing government shutdown, the EU’s relaxation of certain climate rules, and the escalation of US-Venezuela tensions. A summary of key domestic and international data releases is also included.

Democratic Sweep: In the first major electoral test of the cycle, strong Democratic turnout secured critical gubernatorial wins in Virginia and New Jersey. The party’s momentum extended down-ballot, with voters in New York electing Democratic Socialist Zohran Mamdani as the city’s next mayor and a key Pennsylvania Supreme Court race also falling in their favor. Overall, these outcomes suggest that voter dissatisfaction with the status quo is high — even with a relatively good economy — signaling a potentially contentious midterm election.

• The Democratic wins immediately intensify the national redistricting battle ahead of the 2026 midterms. Following partisan map-redrawing efforts in Republican-led states like Texas and Missouri, California responded by advancing Proposition 50. This ballot measure would allow the state to suspend its independent commission and implement new, legislatively drawn congressional maps to gain Democratic seats, effectively escalating a state-by-state partisan “arms race” for control of the US House.
• Given the White House’s “build fast and fix later” strategy, there is speculation that the administration could seek to inject additional stimulus into the economy. Such a move would likely be aimed at boosting economic sentiment to help the party in power retain control of both houses of Congress. This approach is consistent with current efforts to expand Medicare coverage for pharmaceuticals and pressure drug companies to lower prices, which are popular, consumer-focused policies.
• While the recent Democratic win might superficially suggest a shift in partisan allegiance, we propose a more fundamental driver: the global trend of electoral dealignment fueled by rising income inequality. Consequently, we anticipate that established political parties will be increasingly compelled to calibrate their platforms, adopting policies that appeal to lower-income households without alienating their wealthier base, a strategic maneuver essential for maintaining broad coalition support.
• That said, the broader political environment is poised to be favorable for equities leading up to the 2026 midterm elections. The administration is expected to utilize its policy levers for additional fiscal stimulus. Critically, the impact of the recent tax bill — likely generating larger tax refund checks for consumers and incentivizing greater capital investment — should provide a material boost, further fortifying an economy that has demonstrated consistent resilience.

Bitcoin Doubts: On Tuesday, bitcoin plunged below $100,000, a critical support level not seen since late June. This sustained decline is largely driven by long-term holders executing a risk-off strategy, having liquidated over $45 billion in holdings in the past month. The sell-off highlights a pivotal shift for the digital asset, which has recently gained popularity among retail investors while also attracting institutional flows due to recent regulatory changes.

• Although a single catalyst remains elusive, the recent downward pressure on crypto assets appears to stem from a confluence of three key factors: tech-sector deleveraging, a persistent liquidity crunch in the repo market, and growing interest in potential quantum-based alternatives to current blockchain protocols.
  • Tech Narrative: Over the past few years, bitcoin has exhibited an increasingly strong correlation with technology equities. According to CME Group, bitcoin’s 60-day correlation with the Nasdaq 100 has risen from its near zero level prior to 2020 to as high as 60% over the past two years. This trend suggests that a portion of the skepticism surrounding crypto may reflect broader shifts in sentiment toward the technology sector as a whole.
  • Repo Problem: Recently, there has been a rise in liquidity stress within the crucial repo market. This environment has forced various financial institutions to increasingly tap Federal Reserve facilities, such as the Standing Repo Facility and the Discount Window, to meet short-term funding needs. While there is no definitive link, the highly liquid nature of certain digital assets makes them prime targets for institutions needing to quickly raise clean capital
  • Quantum Hype: Adding to long-term uncertainty is the emergence of “quantum money,” a theoretical alternative to code-based blockchain systems that would secure ledgers through the laws of physics rather than cryptography. Though still conceptual, recent breakthroughs in quantum technology — especially the release of specialized hardware like the Willow Chip — have fueled speculation about the eventual obsolescence of current cryptographic infrastructure.
• Of the three possibilities, the most concerning is that the crypto sell-off signals underlying liquidity strain. If confirmed, this could point to a broader systemic issue. While it is worrisome, the Federal Reserve does possess the necessary tools to manage such liquidity pressures. Therefore, we do not expect this specific issue to have significant long-term repercussions on the broader market.

Tech Skepticism: The tech sell-off persisted as mixed earnings reports dampened sentiment in the AI sector, keeping investors focused squarely on quarterly results. On Tuesday, chipmaker AMD beat expectations but offered weak guidance, and Super Micro Computer failed to excite investors with earnings that fell short of forecasts. The disappointing performance from these companies highlights the growing expectations for AI-related firms (particularly those outside of established tech giants) despite concerns over high valuations and weak underlying fundamentals.

Shutdown Tensions: The US government shutdown is now the longest on record, but a bipartisan compromise is finally emerging among centrist senators. The proposed deal involves immediately reopening the government with a short-term bill. In exchange, Republican leadership would commit to holding a dedicated vote on the expiring Affordable Care Act premium subsidies. This shift towards accepting a promise to vote, rather than a guaranteed extension, signals growing post-election momentum to resolve the standoff.

EU Soft Regulation: The European Union has agreed to scale back its ambitious 2040 climate targets following 18 hours of intense negotiations. The revised plan lowers the carbon emission reduction target to 90% and includes key concessions, such as delaying the expansion of its carbon pricing system and permitting member states to outsource a portion of their emission reductions to other countries. This policy shift is viewed favorably for European equities, as it reduces the near-term regulatory burden on domestic industries.

Venezuela Pressure: Venezuelan President Nicolás Maduro is escalating domestic repression in response to heightened US pressure over alleged drug trafficking. This American pressure, which has manifested as a ramped-up Caribbean military presence under the guise of anti-narcotics operations, is widely viewed as a modern echo of the Monroe Doctrine. This effort to reassert hemispheric dominance and deter states like Venezuela from partnering with China carries a real risk of escalation.

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by Patrick Fearon-Hernandez, CFA, and Thomas Wash

[Posted: 9:30 AM ET] | PDF

Our Comment opens with an analysis of mounting concerns over a potential market pullback. We then examine how a wave of new AI partnerships continues to provide crucial market momentum. Our coverage further extends to government initiatives in the energy and commodities sector, conflicting signals from Fed officials on December rate cuts, and a notable shift in sentiment among UK youth regarding welfare benefits. We also include a summary of key international and domestic data releases.

Pullback Concerns: Wall Street leaders, such as David Solomon and Ted Pick, foresee a “healthy” market correction within the next 12-24 months, citing a dangerous divergence between valuation and fundamentals. While corporate earnings are robust, they are being vastly outpaced by exuberant price appreciation. This has created a clear schism where, on one side, there is analytical caution dictated by financial models, while on the other, there is a market psychology driven by unwavering faith in tech’s secular growth.

• Palantir appears to be driving today’s market narrative by serving as a prime example of the current tension in tech. Despite reporting robust earnings and providing strong forward guidance, its stock has declined. This counterintuitive sell-off highlights investor apprehension that a 175% year-to-date rally — and the resulting P/E ratio of 688.49 — has created a valuation that its underlying business performance cannot support, leading to renewed concerns of a sector-wide bubble.

• Historical precedent suggests this weakness is temporary. The Magnificent 7 have a track record of weathering periods of skepticism and early-year underperformance, consistently rallying to fuel broader market gains. In our view, the current negative sentiment mirrors these past episodes and is unlikely to derail the sector’s near-term trajectory.
• The case for sustained equity strength is compelling and rooted in a US economy that is demonstrating solid growth. Key data indicates twin engines of growth including unwavering household demand and a landmark acceleration in AI capital expenditure. Meanwhile, a labor market that is normalizing rather than weakening provides crucial stability. Given this combination of persistent demand and transformative investment, we anticipate further market appreciation, albeit at a potentially more selective and moderate pace.

AI Partnerships: The market is paying a lot of attention to the growing interconnectedness of tech companies. On Monday, Amazon Web Services (AWS) announced a multi-year, $38 billion agreement with OpenAI to provide it with massive cloud computing resources. The landmark deal is expected to significantly bolster confidence in AWS’s cloud computing infrastructure as it competes aggressively against rivals like Microsoft, Alphabet (Google), Oracle, and CoreWeave, all of whom are securing similar contracts to power the AI boom.

• Following the announcement, Amazon’s stock surged, a trend mirrored across the broader Magnificent 7 as investors continue to pour money into AI. The primary source of investor confidence is the robust and growing supply chains these firms are building, coupled with significant revenue diversification. This reassures the market that these companies have multiple avenues to justify their lofty valuations.
• Specifically, this move signifies that OpenAI is diversifying its cloud infrastructure beyond Microsoft, a strategic shift as it operates more like a for-profit company rather than a non-profit. Simultaneously, Amazon has solidified its status as a major AI player by securing OpenAI as a client, adding to AWS’s existing partnership with OpenAI’s rival, Anthropic.
• We anticipate a continued flow of strategic deals over the next few months as major tech companies aim to diversify both their revenue streams and supply chains. This proactive diversification is crucial for building resilient AI infrastructure and significantly reducing reliance on any single vendor. While we acknowledge that current tech valuations are elevated, we maintain that companies with strong balance sheets should see sustained momentum.

Government Investments: The White House has announced a series of new funding initiatives aimed at boosting US competitiveness in the commodities and energy sectors. On Monday, President Trump unveiled $100 million in funding for coal-related initiatives, although the specific source of the funds was not clarified. Additionally, the administration has committed $750 million to rare earth startups, a move that will involve the government taking equity stakes in the companies. These actions underscore the government’s growing role in the economy.

Rate Cut Doubt? Signals from Federal Reserve officials have cast doubt on the likelihood of a rate cut in December, revealing a split in their policy priorities. Chicago Fed President Austan Goolsbee emphasized that his dominant worry is persistent inflation, overshadowing labor market considerations. Meanwhile, Fed Governor Lisa Cook suggested her unease is more focused on the labor market’s health. This divergence creates a lack of clear guidance, which is expected to temper enthusiasm for risk assets as investors prefer the certainty of a dovish pivot.

US-China Trade Relations: In a sign of easing trade tensions, the US and China are moving toward normalizing relations. Chinese officials are expected to resume sales of rare earth metals to the US, while the White House has signaled a greater openness to allowing chip exports to China. These reciprocal gestures are likely to bolster confidence that the trade relationship will not be abruptly severed, even as the risk of future disputes remains. This should offer some support to the broader market.

EU Restraint: The European Union is considering measures to tighten its membership process, aiming to prevent the admission of what it might see as “Trojan horses.” The proposed plan would place new entrants on a probationary period before granting full membership, ensuring they do not backslide on democratic principles after joining. This measure is designed to prevent a repeat of situations like that of Hungary, which, after joining the bloc, subsequently cracked down on free speech.

UK Sentiment Shift: As the UK’s ruling Labour Party prepares to push through more tax hikes, polls show a growing number of young voters are expressing support for a crackdown on crime and benefits. This sentiment highlights the public’s growing dissatisfaction with the government as it struggles to manage the nation’s rising debt. The discontent appears to be fueling a rise in popularity for the Reform UK and Green parties, a sign that the traditional political duopoly is starting to lose favor.

Note: Due to the federal government shutdown, we were unable to update the Business Cycle Report this month. The report will return as soon as we are able to once again access government data.

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by Patrick Fearon-Hernandez, CFA, and Thomas Wash

[Posted: 9:30 AM ET] | PDF

Our Comment today opens with news that key oil-producing countries have agreed to stop boosting output as the risk of a global glut becomes more evident. We next review several other international and US developments that could affect the financial markets today, including news that China will again allow the export of some Nexperia computer chips to avoid the risk of major disruptions to world auto production, while President Trump has said that China has promised not to attack Taiwan as long as he’s president.

Global Oil Market: The Organization of the Petroleum Exporting Countries and its Russia-led allies said they will hike oil production by another 137,000 barrels per day on December 1. However, they said they would then hold output steady to address the risk of an oil glut as global economic activity is set to slow in 2026. The announcement apparently aims mostly to keep oil prices from falling much further. However, we see no indication that the announcement will boost oil output and spur even greater OPEC+ output in the coming months.

China-Netherlands: The Chinese Ministry of Commerce on Saturday said it may exempt some Nexperia orders from an export ban that it imposed after the Netherlands seized control of the Chinese-owned Dutch chipmaker in October. In particular, global automakers were facing the prospect of having to shut down production due to a lack of Nexperia’s legacy semiconductors. China’s move to exempt at least some exports is evidently part of the framework of the US-China trade deal announced last week. News of the exemption should help buoy global stock prices today.

United States-China-Taiwan: In an interview over the weekend, President Trump said General Secretary Xi and other Chinese officials have assured members of the US administration that China will take no action to seize control of Taiwan as long as Trump is president, ostensibly “because they know the consequences.” It’s not clear if the Chinese have offered a formal commitment regarding Taiwan, but to the extent that they have, it would likely reduce the risk of a disruptive US-China military clash and be supportive of both countries’ stock markets.

China: New data shows the third-quarter earnings of China’s mainland-listed companies were up 11.6% from the same period one year earlier, accelerating from annual gains of just 1.2% in the second quarter and 3.2% in the first quarter. The figures suggest the government is having some success with its policies to rein in excess capacity and fierce price competition while also pumping up corporate and consumer stimulus. The recovery in profit growth is probably a key reason why Chinese stocks continue to appreciate strongly.

Japan-South Korea: Underscoring the positive comments from Japan’s newly installed Prime Minister Sanae Takaichi after meeting South Korea’s leader last week, South Korean President Lee Jae Myung on Saturday said he also “had a very good feeling [about Takaichi]. All my worries vanished.” The mutually laudatory remarks from Takaichi and Lee suggest that Japanese-Korean relations remain on track and are unlikely to be disrupted in a way that would weigh on either country’s economy or stock market.

United States-Nigeria: President Trump on Saturday said he has ordered the Pentagon to prepare for a possible US military intervention in Nigeria to protect its Christians from ongoing attacks by the country’s Islamist militants.

• US attacks on the militants don’t appear to be imminent, but the rhetoric may unsettle many isolationists in the president’s political coalition because it would likely remind them of the US’s long wars in Iraq and Afghanistan.
• The statement might be especially unsettling after the US’s recent participation in Israel’s attack on Iranian nuclear sites.

US Dollar: According to the Financial Times, officials at the White House, the Treasury Department, and other federal agencies are looking for ways to encourage more foreign countries to use the dollar as their main currency. The effort reportedly aims to push back against China’s effort to undermine the dollar and boost usage of the renminbi.

• Nevertheless, we see no evidence that any major economy is considering a shift to using the dollar, so the effort seems unlikely to change the greenback’s developing bear market.
• Since foreign stocks typically outperform US stocks when the dollar is weak or depreciating; any continued trend in that direction is likely to be positive for foreign stock returns versus US stock returns.

Czech Republic: After winning the most votes in last month’s elections, but not a majority, the ANO party of Eurosceptic billionaire Andrej Babiš today will sign a coalition deal with two far-right parties, allowing Babiš to become prime minister. The inclusion of the far-right parties will likely make the Czech Republic another source of irritation and policy resistance for European Union leaders in Brussels. For example, the country will now be more likely to resist aid to Ukraine, greater EU integration, and rule-of-law mandates from Brussels.

Note: Due to the federal government shutdown, we were unable to update the Business Cycle Report this month. The report will return as soon as we are able to once again access government data.

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