Tag Archive for: Federal Reserve

Derivative Logic Logo

What the Fed’s Great Unwind Means for Rates

The Beginning of the End of QE (“Quantitative Easing”). Its been well advertised the Fed will begin unwinding its $4.5 trillion-dollar balance sheet this month, initially by reinvesting a gradually smaller amount of Treasuries and allowing Mortgage-backed securities to mature without replacement in its massive portfolio. As such, October 2017 will go down in history […]

Diminishing Expectations

Last Week: The fixed income markets shrugged off last week’s political fireworks, both foreign and domestic. Interest rates rose slightly while equities posted little net change on the week despite the much-hyped “Super Thursday” – filled with a European Central Bank interest rate decision, testimony from ex-FBI director Comey and a surprise result from the […]

Janet is Smarter Than You

Last Week: Interest rates were mixed as global equities rose after the US Federal Reserve indicated it will raise rates gradually and the populist Freedom Party fared worse than expected in Dutch elections. The US Dollar seemed unimpressed, falling as Oil remained unchanged on high inventories while Gold rallied.  The US 10-year yield fell to […]

Trumping Trump

Last Week:  Interest rates surged and global equities extended gains last week, as strong global manufacturing data suggested that economic momentum continues to improve. Yields on the 10-year US Treasury and 1-month LIBOR rose markedly – to 2.49% from 2.32%, and to .8344% from .7848% respectively – as markets priced in a March 15 Fed […]

Behind the Curve?

Last Week: Interest Rates fell in concert with equity markets continuing their record setting streak. The Dow Jones Industrial Average recorded 10 record daily closing highs in a row as of last Friday, driven higher by investors optimism that US president Trump will cut taxes, reduce regulation and implement a sweeping infrastructure spending program. The […]

In Trump We Trust

Last Week: Interest rates fell while and global equities continued their advance on increasing evidence of improved US economic growth and rebounding inflation. Major US indices again notched record highs during the week, supporting the “In Trump We Trust” feeling of equity markets, though bond yields held steady. Despite the strong data, the yield on […]

Prepping for December

Last Week: The highlight of the week was news that in Q3, America enjoyed its best quarter of economic growth in two years. The economy expanded at a 2.9% annual rate, boosted by a rise in inventories and a narrower trade deficit. Personal consumption, versus inventory restocking by businesses, was surprisingly muted. The US wasn’t […]

2017 Rate Outlook Coming Into Focus

Last Week: The minutes of the September Fed meeting stole the show last week, revealing that several officials felt a rate hike is needed “fairly soon,” and that an argument could be made for either an increase at that (September’s) meeting or shortly thereafter. Officials made note that Q4 reads on the health of the […]

December: It’s a Done Deal

Last Week: The US employment report for September – the undisputed highlight of the week – was somewhat weaker than expected at 156K, but not weak enough to dent anticipation of a quarter-point hike by the Fed before the end of the year. Wages, another key piece of the report critical to continued growth in […]

Jobs Report to Inspire Confidence in a December Hike

Last Week: A mixed up week with a myriad of positive and negative forces leaving markets with no clear direction. News of more robust US growth in Q2 and signs of improvement in Q3 were positives, encouraging global investors to buy US government bonds anew, driving yields lower. Global equities were little changed, Oil prices […]