The Treasury curve bear steepened overnight on global supply pressures (Australian and U.K. issuance), and the trend is continuing this morning on solid U.S. economic data. The 10-year yield is up to 3.05% (highest since 2011), and the 2-year/10-year spread is 3 bps wider to 0.48%. Global equity markets are mixed today, and S&P 500 futures are currently down 15 points. Unresolved trade tensions with China are being blamed for the weakness in U.S. and European stocks this morning, but it’s more likely attributable to today’s rise in long-end yields (nothing new on the trade front from a headline perspective).

The April retail sales report was largely in line with expectations, with the headline growth rate up 0.3%, and the control group (used in GDP calculation) rose 0.4% versus the prior month. Another positive from the April report was the upward revisions to the March data, including a 0.5% growth rate (up from 0.4%) for control group sales.

Jason Haley
Managing Director, Investment Management Group

Date TimeEventSurveyActualPriorRevised
05/15/2018Empire Manufacturing1520.115.8
05/15/2018Retail Sales Advance MoM0.30%0.30%0.60%0.80%
05/15/2018Retail Sales Ex Auto MoM0.50%0.30%0.20%0.40%
05/15/2018Retail Sales Ex Auto and Gas0.40%0.30%0.30%0.40%
05/15/2018Retail Sales Control Group0.40%0.40%0.40%0.50%
05/15/2018Business Inventories0.10%0.60%
05/15/2018NAHB Housing Market Index6969
05/15/2018Total Net TIC Flows$44.7b
05/15/2018Net Long-term TIC Flows$49.0b
05/15/2018Mortgage Delinquencies5.17%
05/15/2018MBA Mortgage Foreclosures1.19%
05/16/2018MBA Mortgage Applications-0.40%
05/16/2018Revisions: Housing Starts
05/16/2018Housing Starts1310k1319k
05/16/2018Housing Starts MoM-0.70%1.90%
05/16/2018Building Permits1350k1354k1379k
05/16/2018Building Permits MoM-2.10%2.50%4.40%
05/16/2018Industrial Production MoM0.60%0.50%
05/16/2018Manufacturing (SIC) Production0.50%0.10%
05/16/2018Capacity Utilization78.40%78.00%
05/17/2018Initial Jobless Claims215k211k
05/17/2018Continuing Claims1780k1790k
05/17/2018Philadelphia Fed Business Outlook2123.2
05/17/2018Bloomberg Economic Expectations52.5
05/17/2018Bloomberg Consumer Comfort55.8
05/17/2018Leading Index0.40%0.30%
05/21/2018Chicago Fed Nat Activity Index0.1
05/22/2018Richmond Fed Manufact. Index-3