3 min readPowell At May FOMC Meeting: Not As Hawkish As Expected The FOMC met yesterday and kept the overnight lending rate unchanged for the 6th consecutive meeting at the 5.25%-to-5.50% range. Their statement acknowledged the recent increase in inflation data by adding “In recent months, there has been a lack of further progress toward the Committee’s…
4 min readQ1 2024 Performance: Risk Assets Outperform The first quarter of 2024 saw everything from stocks, gold and even Bitcoin rise to record highs as it becomes increasingly likely that the Fed will be able to achieve a soft landing for the U.S. economy. Treasury yields were mixed during the first quarter with 1-month to 6-month…
3 min readPowell: “Not Far” From Rate Cuts In Fed Chair Powell’s semiannual testimony before Congress, he suggested the FOMC is getting closer to cutting rates by saying “We’re waiting to become more confident that inflation is moving sustainably at 2%,”…..“When we do get that confidence — and we’re not far from it — it’ll be appropriate…
3 min readAnother Record Month for the Corporate Bond Market The investment-grade corporate bond market hit a record for new issuance for a second straight month in February. Blue-chip companies sold a February record of $195+ billion of bonds last month, topping the previous February 2023 record of $150.9 billion. Approximately $50 billion of bonds were sold…
4 min readEconomic Data Supports Feds Delayed Rate Cuts Data released this month supports the patient tone regarding rate cuts that both Fed Chair Powell and other Fed members have been conveying so far this quarter. Stronger inflation and labor market data has led to a recent surge in rates, with the 2-year yield rising 18 basis…
3 min readLabor Market Steady with Signs of Slowing The December employment report was mixed: although non-farm payrolls came in higher than expectations at 216,000, there were 845,000 people who left the labor force, the largest drop in the labor force participation rate since January 2021. For 2023, there were a total of 2.697 million jobs created…
2 min read2023 Recap Despite the majority of market participants forecasting a recession in 2023, GDP rose over 2% in both the first and second quarters and jumped 4.9% in the third quarter, while both equity and fixed income markets had positive returns in 2023. The resilient consumer, cooling inflation, and the Fed’s pivot to deeper 2024…
2 min readNovember – The Everything Rally It was truly a November to remember as equities, Treasuries, investment grade & high yield corporate bonds, and commodities all posted solid gains. The primary drivers were a dovish pivot from Fed members and expectations of a soft landing for the U.S. economy, which translated into the markets eliminating odds of…
3 min readData Supports a Fed on Hold At a recent speech, Fed Chair Powell pushed back on the narrative that the Fed is done raising rates. He continues to reiterate the Fed will be reviewing monetary policy decisions “meeting by meeting” and that more data is needed to show inflation is coming down sustainably. Since the meeting,…
3 min readGDP Doubled in Q3 2023 The first reading for 3rd quarter GDP came in at +4.9%, more than double the +2.1% reading in the 2nd quarter and the most in nearly two years. The US consumer continues to drive the economy forward with personal consumption rising +4%. Spending on services rose by the most in…