The Treasury curve bull flattened overnight with global equity markets weaker (Nikkei -1.03%, Hang Seng -2.21%, Euro Stoxx -1.08%). The popular reasoning for today’s market tone is trade jitters after the White House confirmed late yesterday that it may increase the tariff percentage on $200 billion of Chinese goods from 10% to 25%, and a top Bloomberg headline this morning highlights China’s readiness to retaliate. S&P 500 futures are down 14 points, and the 10-year Treasury yield is back below 3%.  Yesterday’s FOMC meeting was uneventful (as expected). There were no policy actions and no dissenting votes, and only a few minor changes were made to the language in the official statement. The description of recent economic activity was changed to “strong” from “solid” in the prior statement. If there was any more meaningful discussion of balance sheet reduction and other matters, it will show up in the minutes of the meeting (released in three weeks).

Jason Haley
Managing Director, Investment Management Group

Date TimeEventSurveyActualPriorRevised
07/30/2018Pending Home Sales MoM0.10%0.90%-0.50%
07/30/2018Pending Home Sales NSA YoY-4.00%-2.80%
07/30/2018Dallas Fed Manf. Activity3132.336.5
07/31/2018Personal Income0.40%0.40%0.40%
07/31/2018Personal Spending0.40%0.40%0.20%0.50%
07/31/2018Real Personal Spending0.40%0.30%0.00%0.30%
07/31/2018PCE Deflator MoM0.10%0.10%0.20%
07/31/2018PCE Deflator YoY2.30%2.20%2.30%2.20%
07/31/2018PCE Core MoM0.10%0.10%0.20%
07/31/2018PCE Core YoY2.00%1.90%2.00%1.90%
07/31/2018Employment Cost Index0.70%0.60%0.80%
07/31/2018S&P CoreLogic CS 20-City MoM SA0.20%0.20%0.20%0.16%
07/31/2018S&P CoreLogic CS 20-City YoY NSA6.40%6.51%6.56%6.69%
07/31/2018S&P CoreLogic CS 20-City NSA Index211.94210.17210.43
07/31/2018S&P CoreLogic CS US HPI NSA Index202.95200.86200.82
07/31/2018S&P CoreLogic CS US HPI YoY NSA6.38%6.41%6.39%
07/31/2018Chicago Purchasing Manager6265.564.1
07/31/2018Conf. Board Consumer Confidence126127.4126.4127.1
07/31/2018Conf. Board Present Situation165.9161.1161.7
07/31/2018Conf. Board Expectations101.7103.2104
08/01/2018MBA Mortgage Applications-2.60%-0.20%
08/01/2018ADP Employment Change186k219k177k181k
08/01/2018Markit US Manufacturing PMI55.555.355.5
08/01/2018Construction Spending MoM0.30%-1.10%0.40%1.30%
08/01/2018ISM Manufacturing59.458.160.2
08/01/2018ISM Employment56.556
08/01/2018ISM Prices Paid75.373.276.8
08/01/2018ISM New Orders60.263.5
08/01/2018FOMC Rate Decision (Upper Bound)2.00%2.00%2.00%
08/01/2018FOMC Rate Decision (Lower Bound)1.75%1.75%1.75%
08/01/2018Wards Total Vehicle Sales17.00m16.68m17.38m
08/02/2018Challenger Job Cuts YoY-4.20%19.60%
08/02/2018Initial Jobless Claims220k218k217k
08/02/2018Continuing Claims1750k1724k1745k1747k
08/02/2018Bloomberg Consumer Comfort59
08/02/2018Factory Orders0.70%0.40%
08/02/2018Factory Orders Ex Trans0.70%
08/02/2018Durable Goods Orders1.00%
08/02/2018Durables Ex Transportation0.40%
08/02/2018Cap Goods Orders Nondef Ex Air0.60%
08/02/2018Cap Goods Ship Nondef Ex Air1.00%
08/03/2018Trade Balance-$46.5b-$43.1b
08/03/2018Change in Nonfarm Payrolls193k213k
08/03/2018Two-Month Payroll Net Revision
08/03/2018Change in Private Payrolls190k202k
08/03/2018Change in Manufact. Payrolls25k36k
08/03/2018Unemployment Rate3.90%4.00%
08/03/2018Underemployment Rate7.80%
08/03/2018Average Hourly Earnings MoM0.30%0.20%
08/03/2018Average Hourly Earnings YoY2.70%2.70%
08/03/2018Average Weekly Hours All Employees34.534.5
08/03/2018Labor Force Participation Rate62.90%
08/03/2018Markit US Services PMI56.256.2
08/03/2018Markit US Composite PMI55.9
08/03/2018ISM Non-Manf. Composite58.659.1