Treasury prices are lower this morning in response to a rebound in global risk markets. Major Asian equity markets closed up more than 2% on news that Huawei’s CFO was granted bail in Canada, which is perceived as a positive for U.S./China trade negotiations.  The Euro Stoxx is up 1.6%, and S&P 500 futures are up 1.1% at the moment. While trade negotiations with China appear to be progressing in a positive way, U.S. officials are separately pursuing a series of actions against China on the technology front (malicious hacking, technology theft, etc.). While it appears that U.S. and Chinese officials are trying to keep these two issues separate (trade and tech), there is some concern in the markets that efforts on the tech front could compromise/derail any progress on trade. When the Trump Administration began announcing tariffs earlier this year, some analysts suggested this was more about curbing technology and intellectual property theft by China, and this may become more evident as events unfold in the coming weeks/months.

The November CPI report came in right on the screws relative to expectations. Headline CPI was unchanged m/m, and excluding food and energy, core prices were up 0.2% on the month. On a year-over-year basis, core CPI was up 2.2% in November, an increase from the 2.1% reading in October.

Jason Haley
Managing Director, Investment Management Group


12/10JOLTS Job Openings710070797009
12/11NFIB Small Business Optimism107104.8107.4
12/11PPI Final Demand MoM0.00%0.10%0.60%
12/11PPI Ex Food and Energy MoM0.10%0.30%0.50%
12/11PPI Ex Food, Energy, Trade MoM0.20%0.30%0.20%
12/11PPI Final Demand YoY2.50%2.50%2.90%
12/11PPI Ex Food and Energy YoY2.50%2.70%2.60%
12/11PPI Ex Food, Energy, Trade YoY2.80%2.80%
12/12MBA Mortgage Applications1.60%2.00%
12/12CPI MoM0.00%0.00%0.30%
12/12CPI Ex Food and Energy MoM0.20%0.20%0.20%
12/12CPI YoY2.20%2.20%2.50%
12/12CPI Ex Food and Energy YoY2.20%2.20%2.10%
12/12CPI Index NSA252.006252.038252.885
12/12CPI Core Index SA259.412259.481258.939
12/12Real Avg Weekly Earnings YoY0.50%0.90%
12/12Real Avg Hourly Earning YoY0.80%0.70%
12/12Monthly Budget Statement-$199.0b-$100.5b
12/13Import Price Index MoM-1.00%0.50%
12/13Import Price Index ex Petroleum MoM-0.10%0.20%
12/13Import Price Index YoY1.30%3.50%
12/13Export Price Index MoM-0.30%0.40%
12/13Export Price Index YoY3.10%
12/13Initial Jobless Claims226k231k
12/13Continuing Claims1649k1631k
12/13Bloomberg Dec. United States Economic Survey
12/13Bloomberg Consumer Comfort60.3
12/14Retail Sales Advance MoM0.10%0.80%
12/14Retail Sales Ex Auto MoM0.20%0.70%
12/14Retail Sales Ex Auto and Gas0.40%0.30%
12/14Retail Sales Control Group0.50%0.30%
12/14Industrial Production MoM0.30%0.10%
12/14Capacity Utilization78.60%78.40%
12/14Manufacturing (SIC) Production0.30%0.30%
12/14Markit US Manufacturing PMI5555.3
12/14Markit US Services PMI54.654.7
12/14Business Inventories0.60%0.30%