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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