February 18, 2021 Headlines

Treasury yields continue to leak higher on the long end of the curve this morning. Yesterday’s blowout January retail sales report is still fresh on market participants’ minds, and increased mortgage-related hedging activity amid this week’s curve steepening has likely fueled this week’s steepening as well. It is unclear at this point the Fed’s comfort level with the recent curve steepening, but we will get a chance to hear from Jerome Powell next Tuesday during his semi-annual monetary policy report before the Senate Banking Committee. Powell could potentially choose to verbally lean against this trend with talks of additional policy tools, including duration extension and yield curve control, or simply reinforce the idea that the Fed is well equipped to battle inflation in the future. A sharp rise in Treasury yields can weigh on risk assets and the flow of credit, which would presumably make the Fed uncomfortable while the economy is still attempting to climb out of the pandemic hole.

Jason Haley
Chief Investment Officer

Date TimeEventSurveyActualPriorRevised
2/18/2021Housing Starts1660k1580k1669k1680k
2/18/2021Housing Starts MoM-0.50%-6.00%5.80%8.20%
2/18/2021Building Permits1680k1881k1709k1704k
2/18/2021Building Permits MoM-1.40%10.40%4.50%4.20%
2/18/2021Initial Jobless Claims773k861k793k848k
2/18/2021Continuing Claims4425k4494k4545k4558k
2/18/2021Import Price Index MoM1.00%1.40%0.90%1.00%
2/18/2021Import Price Index ex Petroleum MoM0.40%0.90%0.40%—
2/18/2021Import Price Index YoY0.40%0.90%-0.30%—
2/18/2021Export Price Index MoM0.80%2.50%1.10%1.30%
2/18/2021Export Price Index YoY—2.30%0.20%0.40%
2/18/2021Philadelphia Fed Business Outlook2023.126.5—
2/18/2021Bloomberg Consumer Comfort——44.9—
2/18/2021Bloomberg Economic Expectations——39.5—
2/19/2021Markit US Manufacturing PMI58.7—59.2—
2/19/2021Markit US Composite PMI——58.7—
2/19/2021Markit US Services PMI58—58.3—
2/19/2021Existing Home Sales6.60m—6.76m—
2/19/2021Existing Home Sales MoM-2.40%—0.70%—

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