US Economy and Credit Markets Ended Feb. 14, 2020
Supporting Image for Blog Post

Treasury yields were little changed last week despite new economic data and uncertainty surrounding the coronavirus. The University of Michigan's Consumer Sentiment Index rose to 100.9 in February, its highest level since the post-recession peak of 101.4 set in March 2018. Gains in positive sentiment towards personal finances and the U.S. economy helped push the index higher. Retail sales rose 0.3% in January over the prior month, which was in line with expectations. In contrast, industrial production fell 0.3% in January, slightly missing expectations of a 0.2% decline. However, the decline was largely driven by a cut back in energy consumption during a mild January as well as Boeing's production halt of its 737 MAX jet. Excluding aerospace production, industrial production was higher in January, which is an encouraging start to the year after a slowdown in 2019. The Consumer Price Index came in below expectations, rising 0.1% in January over the prior month, mostly due to lower gas prices as the effects of coronavirus lowered demand. Meanwhile, the U.S. Treasury sold 30-year bonds at a record low yield of 2.061% on Thursday, with yields pushed down in part due to fears that the outbreak of coronavirus will slow economic growth. Major economic reports (related consensus forecasts, prior data) for the upcoming week include Tuesday: February Empire Manufacturing (5.0, 4.8); Wednesday: February 14 MBA Mortgage Applications (N/A, 1.1%), January Housing Starts (1,415k, 1,608k), January PPI Final Demand MoM (0.1%, 0.1%); Thursday: February 15 Initial Jobless Claims (210k, 205k), January Leading Index (0.4%, -0.3%); Friday: February Preliminary Markit US Manufacturing PMI (51.5, 51.9), January Existing Home Sales (5.45m, 5.54m).
Posted on Tuesday, February 18, 2020 @ 8:05 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.