3/25- Weekly Economic Highlights
Mar 25, 2022 | Weekly Highlights
Financial markets were mixed this week as Treasury yields increased amid ongoing developments in the Russia-Ukraine war and its impact on the global economy. The U.S. Treasury yield curve flattened as 2-year Treasury yields increased to approximately 2.30% while the 10-year Treasury yield increased to around 2.55%. U.S. stocks are headed for a second weekly gain while oil prices remain elevated at $113.64 per barrel due to tighter supplies.
Economic data was mixed this week. Sales of new U.S. homes fell 2% in February to an annualized pace of 772,000. This is the second month in a row of declining sales implying high prices and rising mortgage rates may be keeping potential buyers on the sidelines. The report also showed the median sales price of a new home increased 10.7% to $400,600 in February from a year earlier. Regionally, sales rose in the Northeast and Midwest but fell in the South and West. Durable goods orders fell 2.2%, missing the consensus of estimate (-0.6%) while reports from both the Richmond and Kansas City Federal Reserve Banks showed continued strength in manufacturing sector.
Consumers remain concerned about their near term economic prospects as U.S. consumer sentiment fell in March because of heightened uncertainty over Russia’s invasion of Ukraine along with ongoing inflationary pressures. The University of Michigan’s sentiment index dropped to 59.4 from 59.7. A gauge of current conditions decreased to 67.2 from 67.8 from a month earlier. Consumers expect inflation to rise 5.4% over the next year and expect prices will increase at an annual rate of 3% over the next 5 to 10 years. Although still above the Federal Reserve’s target inflation rate, it may offer some support to the Fed that long-term expectations remain anchored.
S&P Case Shiller 20-City Home Price Index, Personal Consumption Expenditures, Conference Board Consumer Confidence, Market News International Chicago Business Barometer, Labor Report, ISM Manufacturing
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