Yields flat to up 2bps with curve steeper to start the day, 2Y at 4.88% and 2Y at 3.985%. Overnight the RBA was on hold at 4.1% for 2nd straight meeting, which was a bit of a dovish surprise. Elsewhere in Asia, China data continues to skew week. European PMI's looked ok. Today we get JOLTS which is of interest to the "data-dependent" FOMC. On the calendar is JOLTS, construction spending, ISM Mfg. today. Looking ahead, the size of Treasury Coupon issue to be announced tomorrow is an under-looked area of market focus.
"We think they are days from failure. They think it is a temporary problem. This disconnect is dangerous."
Tuesday, August 1, 2023
Daily Economic Update: August 1, 2023
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U.S. yields start the day lower, with the 2Y down 4bps back at 5% and the 10Y down 6bps at 4.26%, both back to where they were pre-SVB (reme...
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We spend endless time debating the Fed’s neutral rate. Much less time asking whether the government can afford it. Enter Fiscal r-star : t...
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Yesterday the FOMC: Held their policy rate at 5.25-5.50% Raised their growth and inflation projections while keeping their median 2024 proj...
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U.S. yields tracking higher ahead of data. 10Y yield back above 4%
ReplyDelete10am data seems to largely miss. Job openings fall to 9.58mm below estimates. ISM Mfg at 46.4, improving from June but below estimates. ISM Prices Paid declines while new orders improve.
ReplyDeleteConstruction spending rose 0.5% v. 06% est.
Yields remain higher on the day
interesting commentary from Claudia Sahm on her own rule. It's worth a read
ReplyDeletehttps://stayathomemacro.substack.com/p/the-sahm-rule-i-created-a-monster