December 17, 2019 Headlines

Treasury prices are drifting higher this morning amid a modest risk-off tone. Brexit is back in the headlines following Boris Johnson’s big election win. The UK prime minister is ruling out an extension to the Brexit transition deadline of December 31, regardless of whether a deal has been reached with European Union officials. In other words, a hard Brexit is back on the table. In fixed income, the 2-year/10-year spread is currently near a 3-month high of 25 bps, and implied interest rate volatility has settled back down to pre-August levels. The latter has been positive for mortgages, with Agency MBS option-adjusted spreads 3-5 bps tighter versus Treasuries on the month.

Jason Haley
Chief Investment Officer

Date Event Survey Actual Prior Revised
12/16/2019 Empire Manufacturing 4 3.5 2.9
12/16/2019 Markit US Manufacturing PMI 52.6 52.5 52.6
12/16/2019 Markit US Services PMI 52 52.2 51.6
12/16/2019 Markit US Composite PMI 52.2 52
12/16/2019 NAHB Housing Market Index 70 76 70 71
12/16/2019 Net Long-term TIC Flows $32.5b $49.5b
12/16/2019 Total Net TIC Flows -$48.3b -$37.6b -$38.1b
12/17/2019 Housing Starts 1345k 1365k 1314k 1323k
12/17/2019 Building Permits 1410k 1482k 1461k
12/17/2019 Housing Starts MoM 2.40% 3.20% 3.80% 4.50%
12/17/2019 Building Permits MoM -3.50% 1.40% 5.00%
12/17/2019 Industrial Production MoM 0.90% 1.10% -0.80% -0.90%
12/17/2019 Manufacturing (SIC) Production 0.80% 1.10% -0.60% -0.70%
12/17/2019 Capacity Utilization 77.40% 77.30% 76.70% 76.60%
12/17/2019 JOLTS Job Openings 7009 7024
12/18/2019 MBA Mortgage Applications 3.80%
12/19/2019 Current Account Balance -$122.0b -$128.2b
12/19/2019 Philadelphia Fed Business Outlook 8 10.4
12/19/2019 Initial Jobless Claims 225k 252k
12/19/2019 Continuing Claims 1676k 1667k
12/19/2019 Bloomberg Consumer Comfort 62.1
12/19/2019 Bloomberg Economic Expectations 51.5
12/19/2019 Leading Index 0.10% -0.10%
12/19/2019 Existing Home Sales 5.44m 5.46m
12/19/2019 Existing Home Sales MoM -0.40% 1.90%
12/20/2019 GDP Annualized QoQ 2.10% 2.10%
12/20/2019 Personal Consumption 2.90% 2.90%
12/20/2019 GDP Price Index 1.80% 1.80%
12/20/2019 Core PCE QoQ 2.10% 2.10%
12/20/2019 Personal Income 0.30% 0.00%
12/20/2019 Personal Spending 0.40% 0.30%
12/20/2019 Real Personal Spending 0.20% 0.10%
12/20/2019 PCE Deflator MoM 0.20% 0.20%
12/20/2019 PCE Deflator YoY 1.40% 1.30%
12/20/2019 PCE Core Deflator MoM 0.10% 0.10%
12/20/2019 PCE Core Deflator YoY 1.50% 1.60%
12/20/2019 U. of Mich. Sentiment 99.2 99.2
12/20/2019 U. of Mich. Current Conditions 115.2
12/20/2019 U. of Mich. Expectations 88.9
12/20/2019 U. of Mich. 1 Yr Inflation 2.40%
12/20/2019 U. of Mich. 5-10 Yr Inflation 2.30%
12/20/2019 Kansas City Fed Manf. Activity -3 -3




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