US Economy and Credit Markets Ended Aug 9, 2019

U.S. Treasury Bonds saw another week of falling yields. Investors continue to prefer government paper over risky assets as global economic sentiment wanes. On Monday, the 2-year Treasury yield fell to its lowest level since the end of October in 2017 as China-United States trade war rhetoric intensified with accusations of China manipulating their currency. Demand for haven assets sparked again on Wednesday as New Zealand, India, and Thailand cut interest rates, furthering concerns for global growth prospects. President Donald Trump's comments on Friday lead yields lower, casting doubt that talks with Chinese officials in September will occur, let alone lead to a quick resolution. Meanwhile, economic data released on Friday showed the Producer Price Index (PPI) increased 0.2% in July, matching expectations, while producer prices are up 1.7% year-over-year. Major economic reports (related consensus forecasts, prior data) for the upcoming week include: Monday: July Monthly Budget Statement (-$120b, -$76.9b); Tuesday: July CPI MoM (0.3%, 0.1%), CPI YoY (1.7%, 1.6%); Wednesday: August 9 MBA Mortgage Applications (N/A, 5.3%); Thursday: August Empire Manufacturing (1.9, 4.3), August Philadelphia Fed Business Outlook (10.0, 21.8), July Retail Sales Advance MoM (0.3%, 0.4%), August 10 Initial Jobless Claims (212k, 209k), July Industrial Production MoM (0.1%, 0.0%), July Capacity Utilization (77.8%, 77.9%); Friday: July Housing Starts (1253k, 1253k), July Building Permits (1270k, 1232k), August Preliminary University of Michigan Sentiment (97.4, 98.4).
Posted on Tuesday, August 13, 2019 @ 7:12 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.