Treasuries initially rallied overnight following President Trump’s comment yesterday afternoon that he ultimately wants to see a stronger dollar. However, prices have reversed course this morning after senior White House sources clarified those comments and said there’s “no daylight” between Mnuchin and Trump on this matter. S&P 500 futures also turned higher following the clarification and are up 10 points at the moment. Beyond the dollar-related news, it’s a fairly quiet morning in the markets.
The initial estimate of Q4 GDP growth was below expectations (2.6% vs. 3.0%), but the underlying details were positive than the headline figure would suggest. Personal consumption was up 3.8% (most since Q2 2016), and final sales were up 3.2% (best since Q2 2015 and a proxy for future growth). Business investment was also improved. The biggest detractors to Q4 growth were stronger imports (increased trade deficit), which shed 113 bps from topline growth, and less inventory building by businesses subtracted 67 bps. The latter is likely a reflection of the stronger demand from both consumers and businesses (i.e., production can’t keep up with pace of demand).
Jason Haley
Managing Director, Investment Management Group
| Date | Event | Surv(M) | Actual | Prior | Revised |
| 01/22 | Chicago Fed Nat Activity Index | 0.22 | 0.27 | 0.15 | 0.11 |
| 01/23 | Richmond Fed Manufact. Index | 19 | 14 | 20 | — |
| 01/24 | MBA Mortgage Applications | — | 4.50% | 4.10% | — |
| 01/24 | FHFA House Price Index MoM | 0.50% | 0.40% | 0.50% | 0.60% |
| 01/24 | Markit US Manufacturing PMI | 55 | 55.5 | 55.1 | — |
| 01/24 | Markit US Services PMI | 54.3 | 53.3 | 53.7 | — |
| 01/24 | Markit US Composite PMI | — | 53.8 | 54.1 | — |
| 01/24 | Existing Home Sales | 5.70m | 5.57m | 5.81m | 5.78m |
| 01/24 | Existing Home Sales MoM | -1.90% | -3.60% | 5.60% | 5.10% |
| 01/25 | Jobless claims media lockup canceled – data on website at 8:30 | ||||
| 01/25 | Initial Jobless Claims | 235k | 233k | 220k | 216k |
| 01/25 | Continuing Claims | 1925k | 1937k | 1952k | 1965k |
| 01/25 | Bloomberg Consumer Comfort | — | 53.7 | 53.8 | — |
| 01/25 | New Home Sales | 675k | 625k | 733k | 689k |
| 01/25 | New Home Sales MoM | -7.90% | -9.30% | 17.50% | 15.00% |
| 01/25 | Leading Index | 0.50% | 0.60% | 0.40% | 0.50% |
| 01/25 | Kansas City Fed Manf. Activity | 14 | 16 | 14 | — |
| 01/26 | Advance Goods Trade Balance | -$68.9b | -$71.6b | -$69.7b | -$70.0b |
| 01/26 | Wholesale Inventories MoM | 0.40% | 0.20% | 0.80% | 0.70% |
| 01/26 | Retail Inventories MoM | — | 0.20% | 0.10% | — |
| 01/26 | GDP Annualized QoQ | 3.00% | 2.60% | 3.20% | — |
| 01/26 | Personal Consumption | 3.70% | 3.80% | 2.20% | — |
| 01/26 | GDP Price Index | 2.30% | 2.40% | 2.10% | — |
| 01/26 | Core PCE QoQ | 1.90% | 1.90% | 1.30% | — |
| 01/26 | Durable Goods Orders | 0.80% | 2.90% | 1.30% | 1.70% |
| 01/26 | Durables Ex Transportation | 0.60% | 0.60% | -0.10% | 0.30% |
| 01/26 | Cap Goods Orders Nondef Ex Air | 0.60% | -0.30% | -0.20% | 0.20% |
| 01/26 | Cap Goods Ship Nondef Ex Air | 0.40% | 0.60% | -0.10% | 0.40% |