The surprise in inflation data reported last week is driving interest rates higher. Market interest rates have moved much higher due to the data released last week. It is the inflation pressure driving these rates up. The Consumer Price Index increased by 0.1% for the month with energy prices declining 5.0% while food prices rose…
read article →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…
read article →The yield curve has moved up with larger increases in the long end. The bond market continues to react to Chairman Powell’s comments including the Jackson Hole presentation. He said the Fed was willing to accept higher unemployment and even a decline in economic activity in order to tamp down inflation. They intend to continue…
read article →Status: Pending Lead Advisor: Rick Maroney
read article →Chairman Powell took the air out of the capital markets last Friday. In case anyone missed it, Chairman Powell reminded everyone the Fed is going to continue to raise managed rates. He said at his annual speech at the Jackson Hole gathering of economists (a convention with really wild nighttime activities where a discussion of…
read article →The debate over recession has not been settled with data in the last month. The debate as to whether we are already in a recession or are about to fall into one continues to drive the volatility in capital markets. The data from last week did not help settle the issue. The Leading Indicators have…
read article →One month of moderating inflation is not enough to cause the Fed to pause. There are many forecasts calling for inflation pressures to ease over the next six months. The July data released last week did reflect a slowdown in the growth of inflation. The Consumer Price Index was unchanged from June. That brought the…
read article →The jobs report and new fiscal stimulus makes the Fed’s job more difficult. The labor market report for July was a huge surprise with some conflicting data. The corporate survey reported growth of jobs of 528,000, more than double expectations. The unemployment rate dropped to 3.5%, a fifty-year low. On the surface this report reflects…
read article →Second quarter advance report of a negative number raises debate about recession. The advance report for second quarter Real GDP was released as a drop of 0.9%. This is the second consecutive quarter of negative growth. For some, this is the popular definition of a recession. For others, it is not a recession since the…
read article →Investors will be dealing with conflicting data and the Fed this week. A wealth of data will be released this week, giving investors evidence of the direction of the U.S. economy. The biggest data point will be the Advance report of second quarter Real GDP. The consensus forecast calls for growth of only 0.5% following…
read article →Inflation data remains high with no sign of it easing yet. The inflation data from last week did not give any indication it was peaking as many had hoped. The CPI was up 1.3% for the month driving the YOY increase up to 9.1% from 8.6%. The core rate was up 0.7% for the month…
read article →Solid job growth makes a recession less likely. In order to enter a recession, employment must decline along with final consumption. The labor market report for June released last week gave no indication employment is heading towards a drop. Nonfarm payrolls increased by 372,000 for the month. The April and May data was revised downward…
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