February 7, 2022 Headlines

The Treasury market is calmer to start the week (for now) following Friday’s sharp sell-off that sent front-end yields 11 basis points higher. Two-year to five-year yields are essentially back to the range of pre-Covid levels (before the Fed cut rates), and as discussed in Friday morning’s commentary, a blowout jobs report was the culprit for the most recent round of fixed income weakness. Upon further inspection, seasonal adjustments and annual benchmark revisions were responsible for much of the upside surprise. To be clear, the labor market is very strong, but the January report came with a decent amount of statistical noise. Regardless, a bond market void of convicted buyers was walloped by speculators pricing for an even more aggressive Fed, including a 50 bps initial rate hike in March. Yes, the market feels a bit oversold on the front-end of the curve, but until we get more firm guidance from the Fed with regards to its intentions, it’s hard to argue that case. The headline event for this week’s calendar will be the January CPI report (Thursday), and geopolitical risks related to Russia and Ukraine remain at the forefront.

Jason Haley
Chief Investment Officer

02/07/22Consumer Credit$25.000b$39.991b
02/08/22NFIB Small Business Optimism97.598.9
02/08/22Trade Balance-$83.0b-$80.2b
02/08/22Revisions: CPI
02/09/22MBA Mortgage Applications12.00%
02/09/22Wholesale Inventories MoM2.10%2.10%
02/09/22Wholesale Trade Sales MoM1.30%
02/10/22Real Avg Hourly Earning YoY-2.40%-2.00%
02/10/22Real Avg Weekly Earnings YoY-2.30%-2.00%
02/10/22Revisions: PPI
02/10/22CPI MoM0.40%0.50%
02/10/22CPI Ex Food and Energy MoM0.50%0.60%
02/10/22CPI YoY7.20%7.00%
02/10/22Initial Jobless Claims230k238k
02/10/22CPI Ex Food and Energy YoY5.90%5.50%
02/10/22Continuing Claims1609k1628k
02/10/22CPI Index NSA280.428278.802
02/10/22CPI Core Index SA285.976284.759
02/10/22Monthly Budget Statement$25.0b-$21.3b
02/11/22Bloomberg Feb. United States Economic Survey
02/11/22U. of Mich. Sentiment67.567.2
02/11/22U. of Mich. Current Conditions72
02/11/22U. of Mich. Expectations64.1
02/11/22U. of Mich. 1 Yr Inflation4.90%
02/11/22U. of Mich. 5-10 Yr Inflation3.10%
02/11/22Revisions: PPI

Subscribe Today!

Subscribe to our email list and get the latest articles and announcements from ALM First.

Recent Articles

ALM First offers investment advisory services through ALM First Financial Advisors, LLC, which is registered with the U.S. Securities and Exchange Commission (“SEC”). SEC registration does not constitute an endorsement of the firm by the SEC nor does it indicate that the firm has attained a particular level of skill or ability. The information contained herein does not constitute investment advice or a recommendation for you to purchase or sell any specific security. You are solely responsible for reviewing the content and for any actions you take or choose not to take based on your review of such content.Information contained herein was derived from third party sources as indicated. While such information is believed to be reliable, no representation or warranty is made concerning the accuracy of any information presented. We have not and will not independently verify this information. Where such sources include opinions and projections, such opinions and projections should be ascribed only to the applicable third party source and not to ALM First.Statements herein that reflect projections or expectations of future financial or economic performance are forward-looking statements. Such “forward-looking” statements are based on various assumptions, which assumptions may not prove to be correct. Accordingly, there can be no assurance that such assumptions and statements will accurately predict future events or actual performance. No representation or warranty can be given that the estimates, opinions or assumptions made herein will prove to be accurate. Any projections and forward-looking statements included herein should be considered speculative and are qualified in their entirety by the information and risks disclosed in the confidential offering document. Actual results for any period may or may not approximate such forward-looking statements. No representations or warranties whatsoever are made by ALM First Financial Advisors, LLC or any other person or entity as to the future profitability of investments recommended by ALM First Financial Advisors, LLC.