Treasury prices are drifting lower on expectedly light volumes as we approach year-end. The slope of the yield curve, as measured by the 2yr/10yr Treasury spread, is up to 57 bps this morning after touching 50 bps on Friday. Equity markets are fairly quiet as well this morning (S&P 500 futures up 2 points) as investors await the tax reform vote. The House is scheduled to vote today at 1:30 p.m. ET. Bloomberg is reporting that Senate Democrat leaders may attempt to delay the vote when the bill comes to the Senate floor by challenging certain provisions that may not meet the requirements for budget reconciliation. If successful, these challenges could force the bill back to the House for consideration excluding those provisions. However, this would only be a temporary measure and is not expected to ultimately obstruct passage of the legislation.

Jason Haley
Managing Director, Investment Management Group

12/18NAHB Housing Market Index70747069
12/19Housing Starts1250k1297k1290k1256k
12/19Housing Starts MoM-3.10%3.30%13.70%8.40%
12/19Building Permits1270k1298k1297k1316k
12/19Building Permits MoM-3.50%-1.40%5.90%7.40%
12/19Current Account Balance-$116.2b-$100.6b-$123.1b-$124.4b
12/20MBA Mortgage Applications-2.30%
12/20Existing Home Sales5.53m5.48m
12/20Existing Home Sales MoM0.90%2.00%
12/21Philadelphia Fed Business Outlook2122.7
12/21GDP Annualized QoQ3.30%3.30%
12/21Personal Consumption2.30%2.30%
12/21GDP Price Index2.10%2.10%
12/21Core PCE QoQ1.40%1.40%
12/21Initial Jobless Claims233k225k
12/21Continuing Claims1898k1886k
12/21Chicago Fed Nat Activity Index0.50.65
12/21FHFA House Price Index MoM0.40%0.30%
12/21Bloomberg Consumer Comfort51.3
12/21Bloomberg Economic Expectations53
12/21Leading Index0.40%1.20%
12/22Personal Income0.40%0.40%
12/22Personal Spending0.50%0.30%
12/22Real Personal Spending0.20%0.10%
12/22PCE Deflator MoM0.30%0.10%
12/22PCE Deflator YoY1.80%1.60%
12/22PCE Core MoM0.10%0.20%
12/22PCE Core YoY1.50%1.40%
12/22Durable Goods Orders2.00%-0.80%
12/22Durables Ex Transportation0.50%0.90%
12/22Cap Goods Orders Nondef Ex Air0.50%0.30%
12/22Cap Goods Ship Nondef Ex Air0.30%1.10%
12/22New Home Sales653k685k
12/22New Home Sales MoM-4.70%6.20%
12/22U. of Mich. Sentiment97.296.8
12/22U. of Mich. Current Conditions115.9
12/22U. of Mich. Expectations84.6
12/22U. of Mich. 1 Yr Inflation2.80%
12/22U. of Mich. 5-10 Yr Inflation2.50%
12/22Kansas City Fed Manf. Activity1516