Investors are adjusting to higher interest rates and acceptable economic growth.

Stock prices and market interest rates rose last week. The TED spread narrowed to 24 basis points as the yield on the ten-year treasury moved up more than the increase in the yield on the two-year. Investors are now focusing on the FOMC meeting at the end of the month. There are still several forecasts of a 75-basis point increase in managed rates at that meeting. Whether they go up 50 or 75 bp is probably dependent on the inflation data due to be released this week. The Consumer Price Index is expected to be reported as having dropped again in August following the -0.2% reported for July.

 

PROBANK AUSTIN ADVISOR - SEPTEMBER 12, 2022