October 21, 2021 Headlines

The directional bias for Treasury yields continues to be higher and steeper, with yields 2 basis points higher across the curve following a relatively quiet overnight trading session. Inflation and monetary policy remain the major themes in fixed income markets. Fed Vice Chair Randal Quarles became the third member of the board of governors this week to express concern over inflation. While acknowledging the risks to employment and economic growth of acting too early, Quarles said he thinks “we might have to reassess the speed with which we would be thinking about raising interest rates” if year-over-year inflation growth persists well above 2.5% into next spring. All eyes will be on Jerome Powell tomorrow morning to see if he reinforces what seems to be a concerted effort by the governors to effectively endorse, or at least not push back on, the recent shift in market pricing for earlier rate hikes.   

Jason Haley
Chief Investment Officer

10/18/21Industrial Production MoM0.10%-1.30%0.40%-0.10%
10/18/21Capacity Utilization76.40%75.20%76.40%76.20%
10/18/21Manufacturing (SIC) Production0.10%-0.70%0.20%-0.40%
10/18/21NAHB Housing Market Index758076
10/18/21Total Net TIC Flows$91.0b$126.0b$164.1b
10/18/21Net Long-term TIC Flows$79.3b$2.0b
10/19/21Housing Starts1615k1555k1615k1580k
10/19/21Building Permits1680k1589k1728k1721k
10/19/21Housing Starts MoM0.00%-1.60%3.90%1.20%
10/19/21Building Permits MoM-2.40%-7.70%6.00%5.60%
10/20/21MBA Mortgage Applications-6.30%0.20%
10/20/21U.S. Federal Reserve Releases Beige Book
10/21/21Initial Jobless Claims297k290k293k296k
10/21/21Continuing Claims2548k2481k2593k2603k
10/21/21Philadelphia Fed Business Outlook2523.830.7
10/21/21Langer Consumer Comfort51.2
10/21/21Leading Index0.40%0.90%
10/21/21Existing Home Sales6.10m5.88m
10/21/21Existing Home Sales MoM3.70%-2.00%
10/22/21Markit US Manufacturing PMI60.560.7
10/22/21Markit US Services PMI55.254.9
10/22/21Markit US Composite PMI55
10/22/21Monthly Budget Statement-$59.0b-$124.6b

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