Treasury yields continued to consolidate with rates ending the week marginally lower across all major benchmark tenors as the ‘holiday trading’ backdrop contributed to reduced volatility. Economic data releases were sparse but continue to show evidence of the consumers ability to navigate more restrictive monetary policy over the course of 2023.
A sharp increase in Housing Starts was indicated on Tuesday as Total Housing Starts rose 14.8% month-over-month for the November period from a 0.2% increase in October. The pick-up in growth can be partially attributed to lower costs of construction materials and home builders adjusting projects to accommodate the higher interest rate environment.
Financial market activity was dominated by the Federal Open Market Committee meeting this week. As expected at the December meeting, the FOMC voted unanimously to leave the federal funds rate unchanged at a target range of 5.25 – 5.50%.
