June 19, 2019 Headlines

Treasuries are giving up some of yesterday’s gains ahead of today’s Fed meeting, and S&P 500 futures are little changed ahead of the open. Yesterday’s trading activity was driven largely by ECB President Mario Draghi’s ultra-dovish press conference, where he suggested more monetary accommodation was all but certain in the near future. However, a Reuters article posted late yesterday afternoon suggested that other ECB leaders were caught off guard by Draghi’s stimulus hints and that there was no consensus within the ECB Governing Council on the path ahead.

As discussed on Monday, the market is not expecting a rate cut from the Fed today, but guidance for policy easing in the very near future is expected. Market participants will be paying close attention to Jerome Powell’s press conference as he attempts to present a very tricky message, and the FOMC will also be releasing an updated Summary of Economic Projections.

On the data front, the MBA mortgage applications index fell 3.4% for the week ended June 14, including a 3.5% in refinance applications. There has been more focus on the potential for increased mortgage refi activity recently amid the strong rally in Treasuries, and the refi index rose 46.5% last week to the highest level since November 2016. For added perspective, current refi application activity, as measured by the MBA, is just 33% of what was experienced back in 2012 during the last major refi wave.

Jason Haley
Managing Director, Investment Management Group

DateEventSurveyActualPriorRevised
6/19/2019MBA Mortgage Applications-3.40%26.80%
6/19/2019FOMC Rate Decision (Upper Bound)2.50%2.50%
6/19/2019FOMC Rate Decision (Lower Bound)2.25%2.25%
6/19/2019Interest Rate on Excess Reserves2.35%2.35%
6/20/2019Current Account Balance-$124.3b-$134.4b
6/20/2019Initial Jobless Claims220k222k
6/20/2019Philadelphia Fed Business Outlook10.716.6
6/20/2019Continuing Claims1680k1695k
6/20/2019Bloomberg Consumer Comfort61.6
6/20/2019Bloomberg Economic Expectations52.5
6/20/2019Leading Index0.10%0.20%
6/21/2019Markit US Manufacturing PMI50.550.5
6/21/2019Markit US Services PMI5150.9
6/21/2019Markit US Composite PMI50.9
6/21/2019Existing Home Sales5.27m5.19m
6/21/2019Existing Home Sales MoM1.40%-0.40%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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