Chair Powell stated that the US central bank is not rushing to cut rates in light of strong labor market and inflation data.
Chair Jerome Powell: – The recent data have clearly not given us greater confidence and instead indicate that it is likely to take longer than expected to achieve that confidence.
- The market is now pricing only 40 bps of rate reductions this year.
- It’s striking how much the markets have adjusted their expectations for the Fed funds rate trajectory compared to a month ago.
- Treasury yields climbed further.
- Goldman expects the Fed to deliver its first rate cut in July.
- Fed officials continue to signal delays in rate cuts.
Source: @economics Read full article
Source: @economics Read full article
- Rate cut expectations for 2024 dipped below 40 bps.
US Economy
- Inflation expectations moved higher as gasoline prices increased.
- Inflation remains sticky.
- The latest US upside inflation surprise stands out among advanced economies.
- An increasing percentage of Americans are making only the minimum payment on their credit card debt.
- . Retail sales surged last month, topping expectations.
- Here are the March changes in retail sales by sector.
- The Atlanta Fed’s GDPNow estimate for Q1 GDP growth jumped after the retail sales surprise.
- Mortgage rates continue to climb.
- Mortgage applications remain well below last year’s levels.
- Delinquencies on FHA loans due to unemployment are increasing.
- The IMF’s projections for growth five years out have been trending lower.
Market Data
- The US increasingly relies on immigrants to grow its labor force.
- Unemployment rates by state:
- Fund managers have been boosting their allocations to commodities.
- Market breadth has deteriorated rapidly …
- Fund managers have been increasingly bullish on equities, …
Source: BofA Global Research
- … with cash levels sinking.
- More firms have been issuing negative guidance.
- The S&P 500 is almost 2% below its 50-day moving average.
- Let’s take a look at the market drawdowns in the current selloff.
- Sectors:
- Equity factors/styles:
Great Quotes
“Character cannot be developed in ease and quiet. Only through experience of trial and suffering can the soul be strengthened, ambition inspired and success achieved.” – Helen Keller
Picture of the Week
Baby Black bear in Shenandoah National Park, VA
All content is the opinion of Brian Decker