Rates Spark: Weak PMIs Help Build The Case For Rate Cuts

Weaker eurozone PMIs have helped markets price in two more ECB rate cuts for 2024. US manufacturing PMI slipped back below 50 and new home sales weakened, but services PMI edged higher. We continue to view the environment as prone to more risk-off, higher volatility and lower market rates.

Rates Spark: Why September Looks Like A Good Month For An ECB Rate Cut

Rates Spark: Markets Are Still Digesting Biden's Departure

US Biden's withdrawal did not have a material impact on EUR rates. The biggest impact for Treasuries was a late-in-the-day rise in yields. Weaker growth data later this week should help the EUR curve steepening. The ECB's Survey of Monetary Analysts shows a well-anchored ECB terminal rate of 2.25%.

Noteworthy ETF Outflows: SHV

Weekly Report: what happened at SHV last week (0715-0719)?

Last week recap: U.S. Treasury yields and dollar see swings

U.S. Treasury yields and dollar see swings last week as markets react to economic data and expectations of Federal Reserve interest rate cuts. The 10-year yield increased by about 5 basis points to 4.24% on Friday. The US dollar's movement during last week was driven by political events and economic data.

SHV: 2 Ways To Beat The Cash Parking 5.1% Yield

Has The Neutral Rate Of Interest Increased?

Rates Spark: Lagarde Clear About Not Committing To Cuts

When Will The Fed Cut

When will the Fed cut rates? The Fed Funds rate is currently above T-Bill market rates. The Fed will cut its rate once the T- bill rate declines and stabilizes. Todd Sullivan sees evidence of a recession hedge by institutional investors for which they have shorted T-Bills. He says the Fed has a history of missing recession signals.

Rates Spark: ECB Unlikely To Satisfy Doves

European Central Bank is not likely to cut at this meeting and will likely refrain from committing to future cuts. Markets are already pricing in two more 25bp cuts for this year. In the US, the momentum is stronger towards a rate cut. In France, the political challenges continue to evolve but markets remain unmoved.

3 Bad Narratives That Are Dead (But Will Persist)

3 Bad Narratives That Are Dead (But Will Persist) Cullen Roche: Raising interest rates does not cause inflation. He says the Great Financial Crisis created some of the worst narratives in finance and economics. In 2008, the Fed cut rates to 0% and many expected this to create hyperinflation risk.

What The U.S. Election Could Mean For Deficits, Debt And The Yield Curve

Government borrowing and the national debt are barely mentioned in the US election campaign. The US government is borrowing the equivalent of 6% of GDP and national debt totals $35tr. Failure to change trajectory risks further debt downgrades, market volatility and higher borrowing costs. Fiscal sustainability of the US is being questioned.

Yield Advantage: Key Takeaways From PIMCO's Secular Outlook

Central banks have achieved disinflation. Real yields are at levels not seen in 15 years. Fiscal policy in the US and abroad is on an unsustainable path. We're in a world of elevated macro and geopolitical risk. PIMCO: There's a yield to be seized and a yield advantage.

Rates Spark: Pricing Of ECB Cuts Facing Limits

Market pricing for 2024 ECB cuts looks stretched. Markets are now pricing in 48bp of ECB cuts in 2024, just shy of two full 25bp cuts. Three UK rate cuts still on the table this year. The Fed’s Beige Book is scheduled for later today.

Economic Update - Q2 2024

Home Market Outlook Economy Analysis Economic Update - Q2 2024. The US economy is still growing but growth has slowed and signs of weakness are apparent. First quarter US real GDP figures came in at a 1.4% annual growth rate. Low savings rates and rising credit card delinquencies bear watching for a potential pullback in consumer spending. The Housing market has felt the effects of higher interest rates.

How Are Financial Markets Really Doing?

Why The Fed's Picking Up Speed Toward Rate Cuts

Fed Rate Cuts - A Signal To Sell Stocks And Buy Bonds?

Fed Rate Cuts - A Signal To Sell Stocks And Buy Bonds? Lance Roberts: Expectations of Fed rate cuts are rising. He says the odds of a 0.25% cut to the Fed rate are now 90%. Since January 2022, the market has rallied on hopes of rate cuts. Roberts says investors should consider reducing equity risk and increasing exposure to Treasury bonds.

Rates Spark: Trump Assassination Attempt Contributes To Steeper Curves