US Economy and Credit Markets Ended June 7, 2019

Bob Carey
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US Economy and Credit Markets Ended June 7, 2019

Posted Under: Weekly Market Commentary

U.S. Treasury prices continued to rise last week as tariffs and weak headline economic data raised concerns about the economy. Treasury bond yields fell on Monday as fears of an economic slowdown ratcheted up after President Donald Trump launched a second tariff front, this time on Mexico. On Tuesday, Treasury bond yields attempted a comeback as Federal Reserve Chairman Jerome Powell and other Fed officials cooled concerns over the United States slowing economy. Fed Chairman Powell asserted that the Fed will "act as appropriate to sustain the expansion." Treasury bond prices finished the week higher with Treasury bond yields dropping on Friday as investors reacted to the U.S. jobs report. Nonfarm payrolls rose 75,000 in May, missing the consensus expected 175,000. Underlying data consisted of the unemployment rate remaining unchanged, productivity up 2.4% this year, and average hourly earnings up 0.2% in May and 3.1% versus a year ago. The weak headline jobs data coupled with the Federal Reserve's comments earlier in the week elevated expectations for rate cuts this year. Major economic reports (related consensus forecasts, prior data) for the upcoming week include: Tuesday: May PPI Final Demand MoM (0.1%, 0.2%), May PPI Final Demand YoY (1.9%, 2.2%); Wednesday: June 7 MBA Mortgage Applications (n/a, 1.5%), May CPI MoM (0.1%, 0.3%), May CPI YoY (1.9%, 2.0%), May Monthly Budget Statement (n/a, $160.3b), Thursday: May Import Price Index MoM ( -0.3%, 0.2%), June 8 Initial Jobless Claims (215k, 218k); Friday: May Retail Sales Advance MoM (0.7%, -0.2%), May Industrial Production MoM (0.2%, -0.5%), June Preliminary University of Michigan Sentiment (98.0, 100.0).

Posted on Monday, June 10, 2019 @ 8:02 AM • Post Link	Share:
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These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.

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