December 15, 2021 Headlines

It’s a very quiet morning for financial markets ahead of this afternoon’s FOMC decision. Both equity futures and Treasury yields are little changed from yesterday’s close. This will be the first official communication from the committee since Fed Chair Powell’s hawkish comments before the Senate on November 30, and there are a few different items to consider. First is the pace of asset purchase tapering, which was just announced at the November meeting at a rate of $15 billion per month. Powell hinted that tapering may need to end a few months earlier, which would suggest an increase to $30 billion per month. We will also see what changes, if any, the Fed makes to its economic assessment and forward guidance in the official statement given the heightened inflation worries of late, as well as the emergence of the omicron variant. Last, but not least, will be the updated Summary of Economic Projections, which will provide updated FOMC participant forecasts for key economic metrics and the fed funds rate.

In other news, Congress passed a $2.5 trillion debt ceiling last night, just ahead of today’s deadline provided by Treasury Secretary Janet Yellen to avoid default. A Wall Street Journal article suggests millennials are “supercharging the housing market,” with 67% of first-time mortgage applications coming from the generation during the first 8 months of 2021. As the article highlights, the general perception was that millennials generally spurned homeownership following the 2008 housing crisis, and a shift in that trend could keep housing demand strong for years to come according to many economist forecasts.

Jason Haley
Chief Investment Officer

DateEventSurveyActualPriorRevised
12/15/2021MBA Mortgage Applications-4.00%2.00%
12/15/2021Empire Manufacturing2531.930.9
12/15/2021Retail Sales Advance MoM0.80%0.30%1.70%1.80%
12/15/2021Retail Sales Ex Auto MoM0.90%0.30%1.70%1.80%
12/15/2021Retail Sales Ex Auto and Gas0.80%0.20%1.40%1.60%
12/15/2021Retail Sales Control Group0.70%-0.10%1.60%1.80%
12/15/2021Import Price Index MoM0.60%0.70%1.20%1.50%
12/15/2021Import Price Index ex Petroleum MoM0.40%0.70%0.50%0.60%
12/15/2021Import Price Index YoY11.40%11.70%10.70%11.00%
12/15/2021Export Price Index MoM0.50%1.00%1.50%1.60%
12/15/2021Export Price Index YoY18.20%18.00%
12/15/2021Business Inventories1.10%0.70%
12/15/2021NAHB Housing Market Index8483
12/15/2021FOMC Rate Decision (Lower Bound)0.00%0.00%
12/15/2021FOMC Rate Decision (Upper Bound)0.25%0.25%
12/15/2021Interest on Reserve Balances Rate0.15%0.15%
12/15/2021Total Net TIC Flows-$26.8b
12/15/2021Net Long-term TIC Flows$26.3b
12/16/2021Initial Jobless Claims200k184k
12/16/2021Continuing Claims1943k1992k
12/16/2021Housing Starts1567k1520k
12/16/2021Building Permits1663k1650k1653k
12/16/2021Housing Starts MoM3.10%-0.70%
12/16/2021Building Permits MoM0.60%4.00%4.20%
12/16/2021Philadelphia Fed Business Outlook29.139
12/16/2021Industrial Production MoM0.60%1.60%
12/16/2021Capacity Utilization76.80%76.40%
12/16/2021Manufacturing (SIC) Production0.70%1.20%
12/16/2021Langer Consumer Comfort51
12/16/2021Markit US Manufacturing PMI58.558.3
12/16/2021Markit US Composite PMI57.2
12/16/2021Markit US Services PMI58.858
12/16/2021Kansas City Fed Manf. Activity2524
12/17/2021Bloomberg Dec. United States Economic Survey

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