Risk markets are struggling again this morning following a tweet from President Trump threatening airstrikes in Syria are imminent. S&P 500 futures are down 22 points ahead of the open, and Treasury prices are higher across the curve (10-year yield back down to 2.75%). The president’s airstrike warning was directed at Russia, which has threatened to shoot down any U.S. missiles fired at Syrian government targets. Headline CPI fell 0.1% in March due to a 2.8% decline in energy prices, but excluding food and energy prices, core CPI rose 0.2% (as expected). On a year-over-year basis, core CPI rose 30 bps in March to 2.1%, which was expected given the base effect. In other words, a much weaker March 2017 core reading presented a lower base for a year-over-year comparison in 2018. Nevertheless, there are still no signs of significant inflation pressures in the economy. Instead, gradual growth in consumer prices toward the Fed’s inflation target aligns with the current plan for gradual policy normalization. The minutes from the March 21 FOMC meeting will be released this afternoon, and multiple Fed leaders (regional bank presidents) will be speaking at separate events over the next few days. Fixed-income markets remain priced for two more rate hikes in 2018, in line with current Fed guidance/projections.

Jason Haley
Managing Director, Investment Management Group

Date TimeEventSurveyActualPriorRevised
04/10/2018NFIB Small Business Optimism107104.7107.6
04/10/2018PPI Final Demand MoM0.10%0.30%0.20%
04/10/2018PPI Ex Food and Energy MoM0.20%0.30%0.20%
04/10/2018PPI Ex Food, Energy, Trade MoM0.20%0.40%0.40%
04/10/2018PPI Final Demand YoY2.90%3.00%2.80%
04/10/2018PPI Ex Food and Energy YoY2.60%2.70%2.50%
04/10/2018PPI Ex Food, Energy, Trade YoY2.90%2.70%
04/10/2018Wholesale Inventories MoM0.80%1.00%1.10%
04/10/2018Wholesale Trade Sales MoM0.10%1.00%-1.10%-1.50%
04/11/2018MBA Mortgage Applications-1.90%-3.30%
04/11/2018CPI MoM0.00%-0.10%0.20%
04/11/2018CPI Ex Food and Energy MoM0.20%0.20%0.20%
04/11/2018CPI YoY2.40%2.40%2.20%
04/11/2018CPI Ex Food and Energy YoY2.10%2.10%1.80%
04/11/2018CPI Index NSA249.588249.554248.991
04/11/2018CPI Core Index SA256.2256.2255.751
04/11/2018Real Avg Weekly Earnings YoY0.90%0.60%
04/11/2018Real Avg Hourly Earning YoY0.40%0.40%0.30%
04/11/2018Monthly Budget Statement-$186.0b-$215.2b
04/11/2018FOMC Meeting Minutes
04/12/2018Initial Jobless Claims230k242k
04/12/2018Continuing Claims1843k1808k
04/12/2018Import Price Index MoM0.10%0.40%
04/12/2018Import Price Index ex Petroleum MoM0.20%0.50%
04/12/2018Import Price Index YoY3.80%3.50%
04/12/2018Export Price Index MoM0.20%0.20%
04/12/2018Export Price Index YoY3.30%
04/12/2018Bloomberg April United States Economic Survey
04/12/2018Bloomberg Consumer Comfort57.2
04/13/2018JOLTS Job Openings60656312
04/13/2018U. of Mich. Sentiment100.5101.4
04/13/2018U. of Mich. Current Conditions121.2
04/13/2018U. of Mich. Expectations88.8
04/13/2018U. of Mich. 1 Yr Inflation2.80%
04/13/2018U. of Mich. 5-10 Yr Inflation2.50%
04/16/2018Empire Manufacturing19.622.5
04/16/2018Retail Sales Advance MoM0.30%-0.10%
04/16/2018Retail Sales Ex Auto MoM0.20%0.20%
04/16/2018Retail Sales Ex Auto and Gas0.40%0.30%
04/16/2018Retail Sales Control Group0.10%
04/16/2018Business Inventories0.60%0.60%
04/16/2018NAHB Housing Market Index7070
04/16/2018Total Net TIC Flows$119.7b
04/16/2018Net Long-term TIC Flows$62.1b
04/17/2018Housing Starts1260k1236k
04/17/2018Housing Starts MoM1.90%-7.00%
04/17/2018Building Permits1325k1298k1321k
04/17/2018Building Permits MoM0.30%-5.70%-4.10%
04/17/2018Industrial Production MoM0.30%1.10%0.90%
04/17/2018Manufacturing (SIC) Production1.20%
04/17/2018Capacity Utilization77.90%78.10%77.70%
04/18/2018MBA Mortgage Applications-1.90%
04/18/2018 14:00U.S. Federal Reserve Releases Beige Book