Treasury prices were higher overnight on softer economic data in Europe and weaker equity markets, but the move has largely reversed following another solid U.S. inflation report. Most Asian and European equity indices are lower today, and U.S. equity futures are effectively flat at the moment. January personal income and spending growth data was largely in line with expectations (income 0.4% and real spending -0.1%), and in the wake of tax reform, real disposable income (adjusted for taxes and inflation) rose 0.6%, the largest monthly gain since December 2012. The PCE deflator (headline inflation) was up 0.4% in January, as expected and boosted by higher energy prices. PCE core was up 0.3% m/m (as expected), and on a year-over-year basis, the core measure was unchanged at 1.5%. Fed Chair Jerome Powell will appear before the Senate Banking Committee today, and markets will be looking to see if he reinforces his hawkish rhetoric from Tuesday’s testimony before the House or tones it down a bit.

Jason Haley
Managing Director, Investment Management Group

02/26Chicago Fed Nat Activity Index0.
02/26New Home Sales647k593k625k643k
02/26New Home Sales MoM3.50%-7.80%-9.30%-7.60%
02/26Dallas Fed Manf. Activity3037.233.4
02/27Advance Goods Trade Balance-$72.3b-$74.4b-$71.6b-$72.3b
02/27Wholesale Inventories MoM0.40%0.70%0.40%0.60%
02/27Retail Inventories MoM0.80%0.20%0.30%
02/27Durable Goods Orders-2.00%-3.70%2.80%2.60%
02/27Durables Ex Transportation0.40%-0.30%0.70%
02/27Cap Goods Orders Nondef Ex Air0.50%-0.20%-0.60%
02/27Cap Goods Ship Nondef Ex Air0.30%0.10%0.40%0.70%
02/27House Price Purchase Index QoQ1.60%1.40%1.50%
02/27FHFA House Price Index MoM0.40%0.30%0.40%0.50%
02/27S&P CoreLogic CS 20-City NSA Index204.45204.21204.11
02/27S&P CoreLogic CS 20-City MoM SA0.60%0.64%0.75%0.74%
02/27S&P CoreLogic CS 20-City YoY NSA6.35%6.30%6.41%6.36%
02/27S&P CoreLogic CS US HPI NSA Index196.23195.94195.78
02/27S&P CoreLogic CS US HPI YoY NSA6.27%6.21%6.13%
02/27Richmond Fed Manufact. Index152814
02/27Conf. Board Consumer Confidence126.5130.8125.4124.3
02/27Conf. Board Present Situation162.4155.3154.7
02/27Conf. Board Expectations109.7105.5104
02/28MBA Mortgage Applications2.70%-6.60%
02/28GDP Annualized QoQ2.50%2.50%2.60%
02/28Personal Consumption3.60%3.80%3.80%
02/28GDP Price Index2.40%2.30%2.40%
02/28Core PCE QoQ1.90%1.90%1.90%
02/28Chicago Purchasing Manager64.161.965.7
02/28Revisions: Pending Home Sales
02/28Pending Home Sales MoM0.50%-4.70%0.50%0.00%
02/28Pending Home Sales NSA YoY-1.70%-1.80%
03/01Personal Income0.30%0.40%0.40%
03/01Personal Spending0.20%0.20%0.40%
03/01Real Personal Spending-0.10%-0.10%0.30%0.20%
03/01PCE Deflator MoM0.40%0.40%0.10%
03/01PCE Deflator YoY1.70%1.70%1.70%
03/01PCE Core MoM0.30%0.30%0.20%
03/01PCE Core YoY1.50%1.50%1.50%
03/01Initial Jobless Claims225k210k222k220k
03/01Continuing Claims1925k1931k1875k1874k
03/01Bloomberg Consumer Comfort56.256.6
03/01Markit US Manufacturing PMI55.955.355.9
03/01Construction Spending MoM0.30%0.70%
03/01ISM Manufacturing58.759.1
03/01ISM Employment54.2
03/01ISM Prices Paid7072.7
03/01ISM New Orders65.4
03/01Wards Domestic Vehicle Sales13.30m13.10m
03/01Wards Total Vehicle Sales17.20m17.07m
03/02U. of Mich. Sentiment99.599.9
03/02U. of Mich. Current Conditions115.1
03/02U. of Mich. Expectations90.2
03/02U. of Mich. 1 Yr Inflation2.70%
03/02U. of Mich. 5-10 Yr Inflation2.50%