Treasury yields are sharply lower (7-9 bps) to start the day amid a wave of negative sentiment overnight.
In perusing the headlines this morning, one is met with some of the following: ‘US Markets Suffer Worst Day Since 2022’,’Rate Cuts Can’t Come Too Soon for US Consumers’, and ‘The Hottest Job Market in a Generation Is Over.’ In addition to these headlines, China unexpectedly cut one of its bank lending rates by the most since 2020, and German and French business sentiment surveys fell sharply.
Offsetting the negativity somewhat, the first estimate of Q2 GDP growth was stronger than expected, including upside surprises for both personal consumption and PCE. Topline GDP growth rose 2.8% q/q (annualized) versus expectations of a 2% increase, boosted by a 2.3% increase in personal consumption (2% expected). Real final sales to domestic purchasers, or GDP minus inventories and trade, rose a solid 2.7% in Q2, up from a 2.4% rate in Q1. Lastly, core PCE rose 2.9% in Q2 versus expectations of a 2.7% gain. The market has given back a little bit of the rally to start the day, but yields are still down 4-8 bps 15 minutes following the GDP release. The market is likely viewing this report as stale information (it is) and focused more on current signs of economic sluggishness both domestic and abroad. All eyes now shift to next week’s FOMC meeting, which is widely expected to signal the initial rate cut at the September meeting.
Jason Haley
Chief Investment Officer
| Date | Event | Survey | Actual | Prior | Revised |
| 7/25/2024 | GDP Annualized QoQ | 2.00% | 2.80% | 1.40% | — |
| 7/25/2024 | Personal Consumption | 2.00% | 2.30% | 1.50% | — |
| 7/25/2024 | GDP Price Index | 2.60% | 2.30% | 3.10% | — |
| 7/25/2024 | Core PCE Price Index QoQ | 2.70% | 2.90% | 3.70% | — |
| 7/25/2024 | Initial Jobless Claims | 238k | 235k | 243k | 245k |
| 7/25/2024 | Continuing Claims | 1868k | 1851k | 1867k | 1860k |
| 7/25/2024 | Durable Goods Orders | 0.30% | -6.60% | 0.10% | — |
| 7/25/2024 | Durables Ex Transportation | 0.20% | 0.50% | -0.10% | — |
| 7/25/2024 | Cap Goods Orders Nondef Ex Air | 0.20% | 1.00% | -0.60% | -0.90% |
| 7/25/2024 | Cap Goods Ship Nondef Ex Air | 0.20% | 0.10% | -0.60% | -0.70% |
| 7/25/2024 | Kansas City Fed Manf. Activity | -5 | — | -8 | — |
| 7/26/2024 | Personal Income | 0.40% | — | 0.50% | — |
| 7/26/2024 | Personal Spending | 0.30% | — | 0.20% | — |
| 7/26/2024 | Real Personal Spending | 0.30% | — | 0.30% | — |
| 7/26/2024 | PCE Price Index MoM | 0.10% | — | 0.00% | — |
| 7/26/2024 | PCE Price Index YoY | 2.40% | — | 2.60% | — |
| 7/26/2024 | Core PCE Price Index MoM | 0.20% | — | 0.10% | — |
| 7/26/2024 | Core PCE Price Index YoY | 2.50% | — | 2.60% | — |
| 7/26/2024 | U. of Mich. Sentiment | 66.4 | — | 66 | — |
| 7/26/2024 | U. of Mich. Current Conditions | 64.4 | — | 64.1 | — |
| 7/26/2024 | U. of Mich. Expectations | 67.5 | — | 67.2 | — |
| 7/26/2024 | U. of Mich. 1 Yr Inflation | 2.90% | — | 2.90% | — |
| 7/26/2024 | U. of Mich. 5-10 Yr Inflation | 2.90% | — | 2.90% | — |
| 7/26/2024 | Kansas City Fed Services Activity | — | — | 2 | — |
| 7/29/2024 | Dallas Fed Manf. Activity | -14.2 | — | -15.1 | — |
| 7/30/2024 | FHFA House Price Index MoM | — | — | 0.20% | — |
| 7/30/2024 | S&P CoreLogic CS 20-City MoM SA | — | — | 0.38% | — |
| 7/30/2024 | S&P CoreLogic CS US HPI YoY NSA | — | — | 6.29% | — |
| 7/30/2024 | S&P CoreLogic CS 20-City YoY NSA | — | — | 7.20% | — |
| 7/30/2024 | JOLTS Job Openings | — | — | 8140k | — |
| 7/30/2024 | Conf. Board Consumer Confidence | 99.8 | — | 100.4 | — |
| 7/30/2024 | Conf. Board Present Situation | — | — | 141.5 | — |
| 7/30/2024 | Conf. Board Expectations | — | — | 73 | — |
| 7/30/2024 | Dallas Fed Services Activity | — | — | -4.1 | — |
| 7/31/2024 | MBA Mortgage Applications | — | — | -2.20% | — |
| 7/31/2024 | ADP Employment Change | 170k | — | 150k | — |
| 7/31/2024 | Employment Cost Index | 1.00% | — | 1.20% | — |
| 7/31/2024 | MNI Chicago PMI | 44 | — | 47.4 | — |
| 7/31/2024 | Pending Home Sales MoM | 1.50% | — | -2.10% | — |
| 7/31/2024 | Pending Home Sales NSA YoY | — | — | -6.60% | — |
| 7/31/2024 | FOMC Rate Decision (Upper Bound) | 5.50% | — | 5.50% | — |
| 7/31/2024 | FOMC Rate Decision (Lower Bound) | 5.25% | — | 5.25% | — |
| 7/31/2024 | Fed Interest on Reserve Balances Rate | — | — | 5.40% | — |
| 8/1/2024 | Challenger Job Cuts YoY | — | — | 19.80% | — |
| 8/1/2024 | Nonfarm Productivity | 1.60% | — | 0.20% | — |
| 8/1/2024 | Unit Labor Costs | — | — | 4.00% | — |
| 8/1/2024 | Initial Jobless Claims | — | — | 235k | — |
| 8/1/2024 | Continuing Claims | — | — | 1851k | — |
| 8/1/2024 | S&P Global US Manufacturing PMI | — | — | 49.5 | — |
| 8/1/2024 | Construction Spending MoM | 0.20% | — | -0.10% | — |
| 8/1/2024 | ISM Manufacturing | 49 | — | 48.5 | — |
| 8/1/2024 | ISM Prices Paid | — | — | 52.1 | — |
| 8/1/2024 | ISM New Orders | — | — | 49.3 | — |
| 8/1/2024 | ISM Employment | — | — | 49.3 | — |
| 8/1/2024 | Wards Total Vehicle Sales | 16.20m | — | 15.29m | — |
