US Economy and Credit Markets Ended March 12, 2021
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The Treasury sell-off continued last week as President Biden signed the latest coronavirus relief bill into law, raising the yield on the U.S. 10-year Treasury to its highest level since before the pandemic. At $1.9 trillion, the latest stimulus bill is the largest of the three stimulus bills to pass since the onset of the coronavirus pandemic. President Biden also urged states to make all adults eligible to receive a vaccine by May 1, which raised the prospects for higher economic growth and inflation and contributed to the increase in longer-term yields. The yield on the 10-Year Treasury closed the week at 1.63%, up from 0.91% at the end of last year. Initial jobless claims for the week ended March 6 were 712,000, which was better than expected and the lowest level of initial claims this year. The University of Michigan Consumer Sentiment Index, meanwhile, rose to its highest level in a year on the relief bill and the increasing availability of vaccines. This week, the Fed meets on Tuesday and Wednesday and is widely expected to leave interest rates unchanged. Major economic reports (related consensus forecasts, prior data) for the upcoming week include Monday: March Empire Manufacturing (14.5, 12.1); Tuesday: February Retail Sales Advance MoM (-0.7%, 5.3%), February Industrial Production MoM (0.4%, 0.9%); Wednesday: March 17 FOMC Rate Decision – Upper Bound (0.25%, 0.25%), March 12 MBA Mortgage Applications (N/A, -1.3%), February Housing Starts (1,565k, 1,580k); Thursday: March 13 Initial Jobless Claims (703k, 712k), February Leading Index (0.3%, 0.5%).
Posted on Monday, March 15, 2021 @ 8:14 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.