US Economy and Credit Markets Ended March 8, 2019

Investment grade and high yield spreads widened marginally last week amid increased issuance and mixed global economic conditions. ECB forecasts for the Eurozone economies disappointed as growth continues to be increasing at a slower rate than anticipated. Amid the lack of growth acceleration, on Thursday, the European Central Bank revealed plans to stimulate the economies by saying they would hold interest rates steady through 2019 as well as issue low-cost long-term loans for banks beginning in September. Last week's Friday nonfarm payrolls report was only shown increasing by 20,000 in February which was far below consensus expectations of 180,000. This disappointment followed a week of mixed reports and while the unemployment rate did continue to fall, and wages were shown increasing, a wider trade deficit and the disappointing European data contributed to raising Treasury prices. Gold rallied meaningfully last week as the weak jobs report and generally weak market conditions increased investor interest in this asset. Major economic reports (related consensus forecasts, prior data) for the upcoming week include: Monday: January Retail Sales Advance (0.0%, -1.2%); Tuesday: February CPI (0.2%, 0.0%); Wednesday: March 8 MBA Mortgage Applications (N/A, -2.5%), February PPI Final Demand (0.2%, -0.1%), January preliminary Durable Goods Orders (-0.5%, N/A) and January Construction Spending (0.4%, -0.6%); Thursday: March 9 Initial Jobless Claims (225k, 223k), January New Home Sales (624K, 621K); Friday: March Empire Manufacturing (10.0, 8.8), February Industrial Production (0.4%, -0.6%), March Preliminary U. Of Michigan Sentiment (95.6, 93.8).
Posted on Monday, March 11, 2019 @ 8:47 AM

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.