US Dollar Index is Weak in the Early Hours on December 15
The US Dollar Index traded with strength for two weeks and started this week on a mixed note amid the dented market sentiment.
Macroeconomic Analysis
Here Are the Economic Indicators We Should Watch
The iShares MSCI ACWI (ACWI), which tracks the performance of the global markets, rose 2% in November 2017.
Eurozone Services PMI: Why It Strengthened in November
The final Eurozone Services PMI stood at 56.2 in November compared to 55.0 in October. It met the preliminary market estimate of 56.2.
France Services PMI: Solid Expansion in November 2017
The final France Services PMI stood at 60.4 in November compared to 57.3 in October. It beat the initial estimate of 60.2.
Germany Services PMI: Why It’s Falling Gradually
The final Markit Germany Services PMI was 54.3 in November compared to 54.7 in October. It didn’t beat the preliminary market estimate of 54.9.
US Dollar Index Is Weak Early on December 13
In the early hours on Wednesday, the US Dollar Index is weak and trading below the opening prices. At 3:50 AM EST, it was trading at 94—a fall of 0.11%.
November Services PMIs: What They Say about Developed Markets
In this series, we’ll analyze the November performances of the services PMIs for developed economies, including the United States, the United Kingdom, the Eurozone, Germany, France, Spain, and Japan.
Why Japan Services PMI Didn’t Meet Expectations in November
The Japan Services PMI fell in November 2017. It came in at 51.2 compared to 53.4 in October. It didn’t meet the market expectation of 52.0.
Insights into the Spain Services PMI for November 2017
The final Spain Services PMI stood at 56.1 in November compared to 55.8 in October. It didn’t beat the preliminary market estimate of 56.5.
How the Corporate Tax Rate Cut Could Affect R&D in the Medtech Industry
The repeal of the tax deduction for high medical expenses may reduce the number of taxpayers opting for costly medical technologies and services.
How the Medical Expense Tax Deduction Affects the Healthcare Industry
According to AARP, around 75% the population claiming these medical expense deductions from their income are 50 years or older.
Will the US Dollar Surge Higher after FOMC Meeting?
The US Dollar Index (UUP) continued its ascent against the other major currencies as investors positioned for a rate hike from the Fed and reacted to the increased possibility of tax reforms by the end of this year.
How We Could Avoid Yield Curve Inversion
Could yield curve inversion be avoided? St. Louis Fed president and CEO James Bullard gave a presentation at a regional economic briefing on December 1. Previously, we looked at the causes of yield curve inversion. In this part, we’ll review Bullard’s suggestions to avoid yield curve inversion. Bullard said that yield curve inversion could be avoided […]
The US Yield Curve Could Invert in Late 2018
When could the yield curve invert? St. Louis Fed president and CEO James Bullard gave a presentation at a regional economic briefing on December 1. In his presentation, Bullard laid out some conditions that could lead to yield curve inversion in 2018. As discussed previously in this series, an inverted yield curve is considered a sign of […]
Why the Euro Continued to Fall Last Week
The euro-dollar (FXE) closed the week ending December 8 at 1.18, depreciating by 1.1% against the US dollar (UUP).
The Primary Cause of Yield Curve Flattening
Interest rates and inflation The pace of interest rate hikes and inflation rate growth have a profound influence on the US yield curve. The US Fed has been communicating its intent to increase interest rates from the current ultra-low level to a target rate of 2.5% over the next few years. The conditions required for […]
What Leads to Yield Curves Flattening
Factors leading to yield curves flattening There are multiple factors that can affect the shape of yield curves. Bonds (BND) with different maturities react differently to changes in economic conditions and expectations. For example, when the US Fed announces an interest rate hike, short-term bonds (SHY), which are to the left side of a yield curve, react […]
Assessing the Risk of a Flattening Yield Curve
St. Louis Fed president and CEO James Bullard gave a presentation at a regional economic briefing on December 1. Throughout this series, we’ll analyze Bullard’s take on the risks of an inverted yield curve.
Spain’s Manufacturing Activity Recovers
Spain’s manufacturing data According to Markit Economics, Spain’s manufacturing PMI (purchasing managers’ index) score rose to 56.1 in November 2017 from 55.8 in October 2017. Although the PMI figure didn’t beat the preliminary estimate of 56.5, it marked the fastest expansion seen since February 2007. Spain’s stronger manufacturing PMI performance was mainly due to increases in the following: improved […]
Eurozone Manufacturing Rises at a Higher Rate in November
Eurozone manufacturing data The Eurozone’s manufacturing PMI (purchasing managers’ index) stood at 60.1 in November, compared with 58.5 in October 2017, according to Markit Economics. The reading met the preliminary estimate of 60. Eurozone manufacturing activity rose due to increases in the following: production output new orders and export orders employment Production output and new order levels reached […]
France’s Manufacturing Data Shows Robust Growth in November
France’s manufacturing purchasing managers’ index According to IHS Markit, France’s final manufacturing PMI (purchasing managers’ index) stood at 57.7 in November 2017, compared with 56.1 in October 2017. The preliminary market expectation was 57.5. Factory activity was at its highest in seven years. Why manufacturing activity rose France’s manufacturing PMI score rose due to the following […]
Germany’s Manufacturing Growth Signals Stronger Business Climate
Germany’s manufacturing data in November Germany’s final manufacturing PMI (purchasing managers’ index) stood at 62.5 in November, compared with 60.6 in October 2017, according to Markit Economics. The November reading met the preliminary estimate of 62.5, and was the second-highest score since February 2011. Germany’s (DAX-INDEX) manufacturing PMI score improved due to increases in the following: new orders exports employment […]
How Will Tax Cuts Impact the Federal Deficit?
The report from the Joint Committee on Taxation included an estimate of budgetary deficits for 2018–2027. Tax reforms could have a limited impact in 2018.
Tax Cuts and Rate Hikes Could Impact the Fed
The proposed tax cuts and the resulting increase in the federal deficit are expected to impact bond markets. It’s important to consider the Fed’s stance.
Are Politics Holding the Euro Back?
The euro-dollar (FXE) closed the week ending December 1 at 1.19, depreciating by 0.33% against the US dollar (UUP).
Will the US Dollar Surge on Tax Reform News?
The US Dollar Index (UUP) managed to close the week ending December 1 in positive territory with a gain of 0.14%.
US Dollar Index and Treasury Yields Are Stable
The US Dollar Index started this week on a stronger note by rebounding on Monday. The US Dollar Index opened Tuesday on a stable note.
Fed’s November Beige Book and Restrained Hiring Plans
The inability of employers to find suitable workers is leading to wage increases, especially in the professional, technical (XLK), and production (XLI) sectors.
The Economic Indicators Covered by the Fed’s Beige Book
Comparing the economic performance with economic expectations and the previous cycles gives investors an idea of whether the economy is expanding or contracting.
Rising Price Pressures: A Sign of Relief for the Bond Markets?
The increase in price pressure, although reassuring for the Fed, might not lead to a higher rate of inflation in the short term.
US Dollar Index and Treasury Yields Are Strong
The US Dollar Index broke its three-week losing streak last week and regained stability. The US Dollar Index opened higher on Monday.
When the United States Sneezes, Will the World Catch a Cold?
Williams suggested that the monetary policy framework should be designed considering the global scenario rather than central banks looking at their economies in isolation.
The Problem with the Current Interest Rates
With global economies progressing toward normalcy or the “new normal,” as Williams called it, central banks are moving toward normalizing policy by signaling interest rate hikes.
Fed John Williams and a Brief History of Monetary Policy
In his speech at the 2017 Asia Economic Policy Conference on November 16, 2017, John Williams, CEO of the Federal Reserve Bank of San Francisco, spoke about the history of monetary policy.
San Francisco Fed John Williams and Monetary Policy Challenges
John Williams, president and CEO of the Federal Reserve Bank of San Francisco, spoke on November 16, 2017, at the 2017 Asia Economic Policy Conference in San Francisco.
The Leading Credit Index: October Update
The Leading Credit Index for October was reported to be -0.70, improving from the revised September reading of -0.64.
Why the S&P 500 Index Is Considered a Leading Indicator
The S&P 500 Index has risen 2.2% in October and is en route to its eighth straight positive monthly close.
US Dollar Index and Treasury Yields Are Strong on November 30
In the early hours on November 30, the US Dollar Index is trading with strength above opening prices.
How Does CEO Confidence Index Assess US and Global Economies?
The Conference Board CEO Confidence Survey is a quarterly report based on a survey that collects responses from approximately 100 CEOs who represent a variety of industries.
Conference Board Consumer Confidence Rose in November
The Conference Board Consumer Confidence Index for November came in at 129.5, up from 126.2 in October.
Understanding the Sharp Rise in Consumer Expectations in October
The November Conference Board LEI reported the average consumer expectations for business conditions for October at 0.96, a sharp increase from the September reading of 0.43.
Why Decreasing Credit Spreads Are a Cause for Concern
The November Conference Board report, which takes October data into account, reported the credit spread at ~1.2—an improvement from the September reading of ~1.1.
What Decreasing Weekly Unemployment Claims Say about the US Economy
In the Conference Board Leading Economic Index, the average weekly unemployment claims have 3.0% weight.
The FOMC’s View of the Equity and Bond Markets
The FOMC’s November meeting minutes deemed the bond market’s yield curve to be flattening between meetings. The report indicated that bond yields have risen since the September FOMC meeting for multiple reasons.
The FOMC’s Outlook for the US Economy
As per economic projections prepared by the FOMC, US real GDP is expected to improve in the final quarter of this year.
Reasons behind a 3rd Weekly Loss for the US Dollar
The US Dollar Index (UUP) had another bad week as traders offloaded long dollar positions amid tax reform uncertainty last week.
The FOMC’s View on the US Economy
At the November meeting, the FOMC staff review indicated that US labor market conditions continued to strengthen and that the US economy continued to expand at a solid pace.
Germany’s GDP at 0.8% in 3Q17: Will It Raise Investor Sentiment?
According to a report by the Federal Statistical Office, Germany’s GDP growth rate was 0.8% in the third quarter of 2017 compared to 0.6% growth in the second quarter of 2017.
The November FOMC Meeting Minutes: Must-Knows
The last Federal Open Market Committee (or FOMC) meeting took place on October 31–November 1. The target range for the federal funds rate stayed unchanged at 1%–1.25%.
Eurozone Consumer Confidence in Positive Zone after a Decade
According to a report from the European Commission, the Eurozone Consumer Confidence Index stands at 0.1 so far in November compared to -1.1 in October 2017.