Are Consumers Finally Starting to Buckle Under Higher Rates?

Are Consumers Finally Starting to Buckle Under Higher Rates? Treasuries are drifting around unchanged as investors ready for the weekend. Fed speak yesterday was pretty much on script as to higher-for-longer and policy is in a good place for the time being.  A couple more Fed officials (Williams and Daly) go today but one is…

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Treasuries Rally on Friendlier Inflation and Slowing Retail Sales

Treasuries Rally on Friendlier Inflation and Slowing Retail Sales Treasuries are rallying on a better inflation report for April – not great but better than the first quarter- and retail sales that disappointed and adds to other recent reports that point to some slowing in both jobs and consumption (more on both below). Rate-cutting odds…

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Inflation Week Arrives

Inflation Week Arrives Treasuries open Inflation Week in the green as investors look ahead to PPI numbers tomorrow followed by the headlining CPI Report on Wednesday. Obviously, investors are hoping for signs of cooling after the string of hot inflation numbers in the first quarter. Currently, the 10yr note is yielding 4.47%, up 7/32nds in…

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Investor Attention Will Quickly Turn to Next Week’s CPI Report

Investor Attention Will Quickly Turn to Next Week’s CPI Report Treasury yields are slightly higher this morning but the moves are rather listless as the market awaits the University of Michigan Sentiment Survey and its inflation expectations later this morning. It’s the last bit of data in a week bereft of meaningful new inputs, but…

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Plenty of Fed Speak This Week After Soft Jobs Report

Plenty of Fed Speak This Week After Soft Jobs Report The return of geopolitical risk is adding to the rally in Treasuries that started after Friday’s softer employment report and that has yields dipping farther in response. Israel has told civilians to leave the Rafah area of Gaza as an attack in the area seems…

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April Employment Report Hints at Some Softness

April Employment Report Hints at Some Softness Nonfarm payroll gains for April were 175 thousand vs. 244 thousand expected and 315 thousand in March (revised up from an initial 303 thousand). Meanwhile, February was revised lower by 34 thousand jobs, and that continues a year-long trend of downward two-month revisions.  Private sector jobs increased 167…

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Fed More Cautious on Inflation While Beginning QT Tapering

Meeting Highlights  As expected, the Fed kept the funds rate range unchanged at 5.25% – 5.50% and Powell’s comments were less hawkish than was expected, but there was disappointment expressed regarding the inflation news so far in 2024. This was acknowledged in the statement with this new addition: “In recent months, there has been a…

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FOMC is the Main Entrée, but Plenty of Hors D’oeuvres Await Investors

FOMC is the Main Entrée, but Plenty of Hors D’oeuvres Await Investors Treasuries are trading in the green this morning, but that’s all subject to what the FOMC statement and press conference provide. While the expectation is for a hawkish Powell and QT tapering information, there is always the risk something unexpected is said, although…

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Investors Brace for FOMC and April Jobs Report

Investors Brace for FOMC and April Jobs Report Treasuries are trading in the green this morning, perhaps in recognition that Japanese officials apparently took advantage of a light volume Monday holiday to intervene in the currency market to defend then yen. It declined to 160yen/dollar overnight, then quickly improved to the low 150’s signaling the…

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Inflation Progress Appears Stalled in 2024

Inflation Progress Appears Stalled in 2024 Treasuries are breathing a sigh of relief as the March PCE inflation figures came in close to expectations, and generally in line with February, so the fear of a hot print wasn’t realized. We talk more about today’s numbers below but suffice it to say they show inflation progress…

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Market Awaits, GDP, PCE, and Record 5-Year Auction

Market Awaits, GDP, PCE, and Record 5-Year Auction Treasuries are trading weak today as the market awaits more consequential reports tomorrow and Friday in the form of first quarter GDP and March PCE. Also, the Treasury will be auctioning a record $70 billion in five-year notes today, which should keep Treasuries on the back foot…

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Geo-Political Risk has Entered the Chat Again

Geo-Political Risk has Entered the Chat Again Hawkish Fed speak and military attacks have provided a host of cross-currents for the market to deal with this week. The risk-off tone that followed initial reports of Israeli strikes in Iran were eventually reversed as the attack was termed limited in scope, and the lack of follow-through…

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