April 29, 2019 Headlines

Treasury prices moved lower overnight with Japanese markets closed for the next two weeks, and S&P 500 futures are little changed ahead of the open. This week will be a busy one with regards to macro events (FOMC meeting and busy data calendar). As was noted on Friday, the Q1 GDP report revealed higher than expected topline growth, but consumption and inflation data was more tepid. As such, the bond market rallied on increased speculation that the Fed may need to execute an “insurance” rate cut in the near future in order to combat disinflation pressures. There will be a press conference following Wednesday’s FOMC meeting, and market participants will be listening closely to Powell’s tone with regards to recent data and market performance (solid) and the lack of upward inflation pressures. While a change in the fed funds rate is not expected at the meeting this week, there is some speculation that the Committee may choose to adjust the interest rate on excess reserves (IOER) by another 5 basis points.

March personal spending data was better than expected on both a gross and inflation-adjusted basis, but core PCE was unchanged on the month versus expectations of 0.1% growth. On a year-over-year basis, core PCE was up just 1.6% (1.7% expected). There was some concern that the March core PCE rate may come in as low as 1.5%, but a 1.6% rate still fuels market speculation that the FOMC doves may push harder for a rate cut at some point soon.

Jason Haley
Managing Director, Investment Management Group

04/29/19BEA Releases March income/spending (includes Feb. outlays)
04/29/19Personal Income0.40%0.10%0.20%
04/29/19Personal Spending0.70%0.90%0.10%
04/29/19Personal Spending0.10%0.10%0.30%
04/29/19Real Personal Spending0.50%0.70%0.00%
04/29/19PCE Deflator MoM0.30%0.20%0.10%
04/29/19PCE Deflator YoY1.60%1.50%1.30%
04/29/19PCE Core Deflator MoM0.10%0.00%0.10%
04/29/19PCE Core Deflator YoY1.70%1.60%1.70%
04/29/19Dallas Fed Manf. Activity108.3
04/29/19Revisions: Dallas Fed Manufacturing
04/30/19Employment Cost Index0.70%0.70%
04/30/19S&P CoreLogic CS 20-City MoM SA0.20%0.11%
04/30/19S&P CoreLogic CS 20-City YoY NSA3.10%3.58%
04/30/19S&P CoreLogic CS 20-City NSA Index213.08212.41
04/30/19S&P CoreLogic CS US HPI YoY NSA3.90%4.26%
04/30/19S&P CoreLogic CS US HPI NSA Index204.71
04/30/19MNI Chicago PMI58.858.7
04/30/19Pending Home Sales MoM1.40%-1.00%
04/30/19Conf. Board Consumer Confidence126.7124.1
04/30/19Pending Home Sales NSA YoY-4.00%-5.00%
04/30/19Conf. Board Present Situation160.6
04/30/19Conf. Board Expectations99.8
05/01/19MBA Mortgage Applications-7.30%
05/01/19ADP Employment Change180k129k
05/01/19Markit US Manufacturing PMI52.452.4
05/01/19ISM Manufacturing5555.3
05/01/19ISM Employment57.5
05/01/19ISM Prices Paid5554.3
05/01/19ISM New Orders57.4
05/01/19Construction Spending MoM0.00%1.00%
05/01/19FOMC Rate Decision (Upper Bound)2.50%2.50%
05/01/19FOMC Rate Decision (Lower Bound)2.25%2.25%
05/01/19Interest Rate on Excess Reserves2.40%2.40%
05/01/19Wards Total Vehicle Sales17.00m17.50m
05/02/19Challenger Job Cuts YoY0.40%
05/02/19Initial Jobless Claims215k230k
05/02/19Continuing Claims1664k1655k
05/02/19Nonfarm Productivity2.30%1.90%
05/02/19Unit Labor Costs1.50%2.00%
05/02/19Bloomberg Consumer Comfort60.8
05/02/19Durable Goods Orders2.70%
05/02/19Factory Orders1.50%-0.50%
05/02/19Durables Ex Transportation0.40%
05/02/19Factory Orders Ex Trans0.30%
05/02/19Cap Goods Orders Nondef Ex Air1.30%
05/02/19Cap Goods Ship Nondef Ex Air-0.20%
05/03/19Advance Goods Trade Balance-$73.0b
05/03/19Wholesale Inventories MoM0.20%0.20%
05/03/19Retail Inventories MoM0.10%
05/03/19Change in Nonfarm Payrolls188k196k
05/03/19Two-Month Payroll Net Revision14k
05/03/19Change in Private Payrolls183k182k
05/03/19Change in Manufact. Payrolls10k-6k
05/03/19Unemployment Rate3.80%3.80%
05/03/19Average Hourly Earnings MoM0.30%0.10%
05/03/19Average Hourly Earnings YoY3.30%3.20%
05/03/19Average Weekly Hours All Employees34.534.5
05/03/19Labor Force Participation Rate63.00%63.00%
05/03/19Underemployment Rate7.30%
05/03/19Markit US Services PMI52.952.9
05/03/19Markit US Composite PMI52.8
05/03/19ISM Non-Manufacturing Index5756.1

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