3 min readTariffs & Government Spending Cuts Stoke Stagflation Fears Concern is increasing that global trade tensions along with government spending cuts could lead to slower growth and higher prices if tariffs remain in place. Many economists have recently lowered US growth outlooks. Even commentary from President Trump and Treasury Secretary Bessent signal some pain ahead: Trump…
4 min readYields Declined on Negative Consumer Outlook Treasury yields declined significantly towards the end of February after two consumer survey reports came in much lower than expected. The drops were most significant in the long end, with the 10-year yield declining 33 basis points, while the 2-year yield fell below 4% for the first time since…
4 min readMixed Data Keeping the Fed on Hold Fed Chair Powell recently said he wants “to see inflation behaving in a way that builds confidence that we are really making progress.” Unfortunately, the January Consumer Price Index (CPI) did not build any confidence that inflation is decelerating, coming in much higher than expectations. Overall, data releases…
4 min readDespite a Wild January, Treasury Yields Ended Little Changed This past January will be one that many of us will never forget. The month started with massive wildfires in Southern California, the inauguration of President Trump, DeepSeek’s disruption of the technology sector, and the first U.S. commercial airline crash since 2009. At month-end, the markets’…
3 min readGovernment Bond Yields Rise Globally The rise in U.S. treasury yields has continued into the new year, primarily driven by 3 factors: A string of solid U.S. releases has continued, with both the ISM Manufacturing & Services reports coming in better than expected, the December nonfarm payrolls beating expectations by nearly 100,000, and the unemployment…
4 min read2024 Recap 2024 saw major central banks begin to ease policy including both the Fed and ECB which each cut rates by 100 basis points. Risk assets had another strong year with the S&P 500 returning +25%, the first time since the 1990s that the index had back-to-back +20% returns. Gold rose over +27%, its…
3 min readFed Speakers Convey Caution on Pace of Rate Cuts Several Federal Reserve officials have echoed a theme conveyed by Fed Chair Powell that the FOMC is in “no hurry to lower rates” and the central bank could slow its easing pace given stronger than expected economic data. For example, year-over-year inflation readings for both CPI…
5 min readPotential for a Fed Santa Pause The Fed followed up their September 50 basis point rate cut with a unanimous 25 basis point cut on November 7th, bringing the federal funds target range to 4.50%-4.75%. With one remaining FOMC meeting this year on December 18th, the market has been flip-flopping between the potential for another…
5 min readResilient Consumer Continues to Spend – No Grinch Forecasted Recent economic data highlights a resilient consumer ahead of the holiday season: Yields Rise on Data and Election Outlook October saw treasury yields rise approximately 40 to 60 basis points from 2 years to 30 years with several narratives behind the increase in yields: Mixed Labor…
3 min readLabor Market Remains Solid but Data Could be Noisy Ahead The September employment report was solid overall but with hurricanes Helene and Milton hitting the Southeast of the United States, labor statistics could be noisy ahead. September Employment Report: Looking ahead, the October jobs report (which will be released on November 1st) will incorporate layoffs…