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ProBank Austin Advisor

July 2, 2018 - 1 min read

The risks of an expanding trade war is overwhelming the economic fundamentals Investors are paying attention to the economic data but are focused on the looming trade war. Stock prices have been declining and bond prices have been rising as capital flows from stocks into bonds. The imposition of tariffs will result in slower economic…

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ProBank Austin Advisor

June 25, 2018 - 2 min read

The yield curve flattened further last week as the risk of a spreading trade war is driving prices The economic data continues to come in above expectations and well above the level of the first quarter. None of this data is driving financial markets. Investors are more concerned about the escalating trade war that has…

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ProBank Austin Advisor

June 18, 2018 - 2 min read

The Fed became more hawkish with last week’s moves. The FOMC did more than just raise managed rates last week. In addition to the 25 basis point increase in the target rate for Fed Funds, they also made significant changes in other areas. They changed theirguidance for future moves from three increases in 2018 to…

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ProBank Austin Advisor

June 11, 2018 - 2 min read

The Fed meets with cross currents of strong data, but trade wars looming in the future. The Fed meets this week with the meeting followed by the press conference with the Chairman. The Fed will also release its latest economic and inflation forecasts. The strong consensus calls for the second managed interest rate increase this…

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ProBank Austin Advisor

June 4, 2018 - 1 min read

Volatility in financial markets from problems in Italy and tariffs masked the strong economic data. The data continues to get better and better. Last week was headlined by the labor market report. Job growth at 223,000 was well above expectations and the monthly average of the first four months of the year. The growth in the labor force has…

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ProBank Austin Advisor

May 21, 2018 - 1 min read

The march up of market interest rates intensified last week. The yield on the ten-year treasuryjumped above 3% and has held at these higher levels. There was no specific inflation data which drove this yield higher as one would normally expect. The entire term structure of market rates moved up 15 basis points during the…

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ProBank Austin Advisor

April 2, 2018 - 1 min read

While the equity market is experiencing several crosswinds creating volatility, the economic fundamentals continue to reflect an accelerating rate of growth. Last week, the FOMC included a significant upward revision to fourth quarter Real GDP growth. Usually this last revision is modest but in this case it was revised from 2.5% to 2.9%. This makes…

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ProBank Austin Advisor

March 26, 2018 - 1 min read

Normally, financial markets would be driven by Fed action in a week when the FOMC meets. That was not the case last week. A much larger factor was investor’s fear of a trade war. Tariffs were announced against China and they responded with threats of raising tariffs of their own. A trade war,even if it…

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ProBank Austin Advisor

March 19, 2018 - 1 min read

Financial markets will be focused on the Wednesday FOMC meeting. It will be the first for new Chairman Powell, as well as his first press conference. The Fed is expected to raise managed rates by 25 basis points but the focal points will be the language in the statement and the tone of the Chairman….

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ProBank Austin Advisor

March 12, 2018 - 1 min read

The labor market report released on Friday blew away all expectations. Job growth was reported as having risen by 313,000 in February and both January and December’s data revised upward by a total of 54,000. There was strong growth in manufacturing and construction jobs and even growth in retail, a sector that has been slow…

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ProBank Austin Advisor

March 5, 2018 - 1 min read

As if we did not have enough risk affecting financial markets, we added the possibility of trade wars last week. Discussion of imposing tariffs on certain imported goods could lead to retaliation by our trading partners and disrupting the flow of goods and services. The largest drag on U.S. economic growth in the past two…

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ProBank Austin Advisor

February 26, 2018 - 1 min read

Coming off a week with very limited economic data, this week will provide a wealth of new data. On balance, we expect the data to reflect a slowing in the strong growth at the end of 2017. Real GDP is due to be revised from the 2.6% growth estimate in the advance report to 2.5%….

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