Articles

ProBank Austin Advisor

January 25, 2022 - 1 min read

The FOMC meets this week with more specific guidance expected for monetary policy. Financial markets are in a quandary. On one hand, the economy is still expanding at a healthy pace despite the surge in the virus and the labor market is very close to full employment. At the same time, inflation remains well above…

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ProBank Austin Advisor

January 18, 2022 - 1 min read

Market rates moved higher on strong inflation data but slower economic growth. The surge in the omicron variant is having an impact on the economy. Retail sales for December declined by 1.9% from the level in November. Sales excluding autos were down by 2.3%. Spending using the internet dropped by 8.7% for the month reflecting…

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ProBank Austin Advisor

January 11, 2022 - 1 min read

More uncertainty was injected into the bond market with the release of the FOMC minutes. The Fed is caught between a rock and hard place. They are trying to navigate between accommodative monetary policy to promote full employment and neutral monetary policy to address the surge in inflation. It does not help when we get…

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ProBank Austin Advisor

January 4, 2022 - 1 min read

We start the year with many uncertainties which must be monitored to make forecasts. The year ends with as many uncertainties as it began with. Everything is centered around the spread and severity of the virus. The surge in infections has already begun to impact economic activity. The initial impact is keeping people from working….

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ProBank Austin Advisor

December 27, 2021 - 1 min read

The surge in the omicron variant is causing forecasts for 2022 to be changed. The surge in the virus we are currently experiencing is causing forecasts for Real GDP growth to be lowered. The rise of the omicron variant is driving a rapid rise in the infection rate across the country. While this variant appears…

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ProBank Austin Advisor

December 20, 2021 - 1 min read

The economy and financial conditions are a captive of the pandemic risks. The Fed exceeded expectations last week. They did increase the amount of the tapering of bond buying from the $15 billion monthly reduction already being executed by doubling it to $30 Billion a month starting in January. That was much more than we…

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ProBank Austin Advisor

December 13, 2021 - 1 min read

The Fed is forced to navigate through a high level of uncertainty with this week’s meeting. The FOMC meets this week with the focus on any changes to the amount of monthly tapering of bond purchases the Fed has already begun executing. They began the end of this quantitative easing program in November and continued…

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ProBank Austin Advisor

December 6, 2021 - 1 min read

Forecasts for the economy and interest rates are highly uncertain given the events last week. Uncertainty has increased by the events of last week. Chairman Powell pivoted from the former Fed view of current conditions under which they have been conducting monetary policy in the past two years. He has eliminated the use of the…

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ProBank Austin Advisor

November 29, 2021 - 1 min read

Economic and interest rate forecasts are on hold until more information about the omicron variant is available. The data released last week was very strong across the board. Incomes rose and demand increased at a faster pace than the third quarter. At the same time, inflation continued to accelerate with the core PCE price index…

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ProBank Austin Advisor

November 22, 2021 - 1 min read

The data has been and is expected to continue to indicate an accelerating rate of growth. A large amount of data will be released in this holiday week. The most important will be the core PCE price index on Wednesday. This is the favored measure of inflation by the Federal Reserve. It had increased by…

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ProBank Austin Advisor

November 15, 2021 - 1 min read

Inflation and labor market data was stronger than anticipated in reports last week. The issue still driving financial markets is inflation. There are those investors who believe inflation is well above expectations of just three months ago, but it will decline during the first half of next year. There are those forecasters who believe inflation…

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ProBank Austin Advisor

November 8, 2021 - 1 min read

No surprise from the Fed last week but a strong jobs report may change things. The FOMC met last week and did not surprise investors; they did exactly what was expected. They announced a tapering of their $120 billion a month of bond purchases beginning this month continuing through December of $15 billion. They will…

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