6/9 – Weekly Economic Highlights
Markets breathed a collective sigh of relief this week following the passing and signing of the Fiscal Responsibility Act of 2023, which effectively suspends the federal debt ceiling through January 1, 2025 and averted a potentially catastrophic US government default.
6/2 – Weekly Economic Highlights
This week market participants were focused on continued stress in the banking sector, the Federal Open Market Committee meeting, and the US labor market. Regional banks remain under pressure due to unrealized losses on long-term bond investments, exposure to commercial real estate lending, and reduced demand for low-yielding deposits. Concerns resurfaced in the market earlier this week causing a flight-to-quality rally in US treasuries.
5/26 – Weekly Economic Highlights
This week market participants were focused on continued stress in the banking sector, the Federal Open Market Committee meeting, and the US labor market. Regional banks remain under pressure due to unrealized losses on long-term bond investments, exposure to commercial real estate lending, and reduced demand for low-yielding deposits. Concerns resurfaced in the market earlier this week causing a flight-to-quality rally in US treasuries.
5/19 – Weekly Economic Highlights
This week market participants were focused on continued stress in the banking sector, the Federal Open Market Committee meeting, and the US labor market. Regional banks remain under pressure due to unrealized losses on long-term bond investments, exposure to commercial real estate lending, and reduced demand for low-yielding deposits. Concerns resurfaced in the market earlier this week causing a flight-to-quality rally in US treasuries.
5/12 – Weekly Economic Highlights
This week market participants were focused on continued stress in the banking sector, the Federal Open Market Committee meeting, and the US labor market. Regional banks remain under pressure due to unrealized losses on long-term bond investments, exposure to commercial real estate lending, and reduced demand for low-yielding deposits. Concerns resurfaced in the market earlier this week causing a flight-to-quality rally in US treasuries.
5/05 – Weekly Economic Highlights
This week market participants were focused on continued stress in the banking sector, the Federal Open Market Committee meeting, and the US labor market. Regional banks remain under pressure due to unrealized losses on long-term bond investments, exposure to commercial real estate lending, and reduced demand for low-yielding deposits. Concerns resurfaced in the market earlier this week causing a flight-to-quality rally in US treasuries.
4/28 – Weekly Economic Highlights
Although economic data was fairly light this week, there was a full slate of speaking engagements by members of the Federal Reserve. Each of the Fed speakers, including Federal Reserve Bank of New York President John Williams, were consistent in their messaging for the near-term direction of monetary policy. Williams, who is also Vice-Chairman of the Federal Open Market Committee emphasized that inflation was still too high, and monetary policy tools would be used to restore price stability. The Vice Chairman does diverge from the majority of other central bank members in that he does not expect a recession which was disclosed in the meeting minutes from the March FOMC meeting last week. Each speaker who addressed the topic of monetary tightening signaled the need for at least one additional rate increase to curtail inflation.
4/21 – Weekly Economic Highlights
Although economic data was fairly light this week, there was a full slate of speaking engagements by members of the Federal Reserve. Each of the Fed speakers, including Federal Reserve Bank of New York President John Williams, were consistent in their messaging for the near-term direction of monetary policy. Williams, who is also Vice-Chairman of the Federal Open Market Committee emphasized that inflation was still too high, and monetary policy tools would be used to restore price stability. The Vice Chairman does diverge from the majority of other central bank members in that he does not expect a recession which was disclosed in the meeting minutes from the March FOMC meeting last week. Each speaker who addressed the topic of monetary tightening signaled the need for at least one additional rate increase to curtail inflation.
4/14 – Weekly Economic Highlights
Investors had a large amount of economic data to process this week, with the March Consumer Price Index (CPI) headline numbers coming in slightly lower than expected, up 0.1% month-over-month and 5.0% year-over-year, moderating from +6.0% in February. Core CPI, which excludes the volatile food and energy components, increased 5.6% year-over year in March, a slight uptick from the previous month. Housing was by far the largest contributor to the increase, along with gains in restaurant dining and new car prices. Since shelter data tends to lag, that factor is expected to fade in the coming months. There were declines in the prices of energy, used cars and trucks, medical care services, and groceries during the month. In other inflation news, the Producer Price Index (PPI) fell 0.5% in March, the largest monthly drop since April 2020, as wholesale prices for goods, especially gasoline, declined. Supply chain disruptions and commodity prices eased from last year when Russia’s invasion of Ukraine caused a spike, but OPEC+ production target cuts are expected to be inflationary.
4/07 – Weekly Economic Highlights
The Chandler team has been calling for positive, but below trend growth, in the first half of 2023 and in aggregate the data releases this week were supportive of the view. The ISM Manufacturing Index continues to face headwinds, coming in at 46.3 for March, compared to 47.7 in the prior month. This is the fifth month in a row with the index below 50.0, signaling contracting activity in the sector. The ISM Services Index also disappointed relative to recent trends with a reading for March of 51.2 compared to the prior months 55.1, but encouragingly still shows expansion in the sector. The Bureau of Labor Statistics updated the Job Openings and Labor Turnover Survey (JOLTS), which is reported with a one-month lag, and for the first time since May 2021 the number of job openings was below 10 million, signaling the tightening of financial conditions is starting to impact the labor market. In a further indication the labor market is not as tight as previously believed, the Department of Labor updated their seasonal factors for weekly unemployment insurance claims and the recent trends show a four-week moving average of 238k; prior to the revisions the four-week moving average was below 200k.