October 23, 2023 Headlines

The 10-year Treasury yield rose above 5% earlier this morning for the first time since 2007 in a continuation of the bear steepening trend in the U.S. bond market. Another day, another steepener. The 2-year/10-year spread is now just -12 basis points (bps), nearly 100 bps steeper than the peak inversion level of -109 bps on March 8. This week’s economic calendar is headlined by the first look at Q3 GDP (Thursday) and the September PCE report (Friday). GDP is expected to have risen a robust 4.3% last quarter, driven by an estimated 4% increase in personal consumption.

In housing news, housing affordability continues to worsen amid surging mortgage rates and sticky home prices. The National Association of Realtors’ housing affordability index is at the lowest level since the index’s inception in 1986. Separately, real estate firm CBRE notes that it’s never been a worse time to buy a home versus renting, according to a Wall Street Journal article yesterday. The average monthly new mortgage payment is 52% higher than the average apartment rent, significantly higher than the previous peak of 33% in Q2 2006. CBRE began tracking the data in 1996.

Jason Haley
Chief Investment Officer

Date	Event	Survey	Actual	Prior	Revised
10/23/2023	Chicago Fed Nat Activity Index	-0.14	0.02	-0.16	-0.22
10/24/2023	Philadelphia Fed Non-Manufacturing Activity	—	—	-16.6	—
10/24/2023	S&P Global US Manufacturing PMI	49.4	—	49.8	—
10/24/2023	S&P Global US Services PMI	49.9	—	50.1	—
10/24/2023	S&P Global US Composite PMI	50	—	50.2	—
10/24/2023	Richmond Fed Manufact. Index	3	—	5	—
10/24/2023	Richmond Fed Business Conditions	—	—	-5	—
10/25/2023	MBA Mortgage Applications	—	—	-6.90%	—
10/25/2023	New Home Sales	682k	—	675k	—
10/25/2023	New Home Sales MoM	1.00%	—	-8.70%	—
10/26/2023	Wholesale Inventories MoM	0.10%	—	-0.10%	—
10/26/2023	Advance Goods Trade Balance	-$86.0b	—	-$84.3b	-$84.6b
10/26/2023	GDP Annualized QoQ	4.30%	—	2.10%	—
10/26/2023	Personal Consumption	4.00%	—	0.80%	—
10/26/2023	Retail Inventories MoM	—	—	1.10%	—
10/26/2023	GDP Price Index	2.70%	—	1.70%	—
10/26/2023	Durable Goods Orders	1.50%	—	0.10%	—
10/26/2023	Core PCE Price Index QoQ	2.50%	—	3.70%	—
10/26/2023	Durables Ex Transportation	0.30%	—	0.40%	—
10/26/2023	Cap Goods Orders Nondef Ex Air	0.00%	—	0.90%	—
10/26/2023	Cap Goods Ship Nondef Ex Air	0.30%	—	0.70%	—
10/26/2023	Initial Jobless Claims	208k	—	198k	—
10/26/2023	Continuing Claims	1738k	—	1734k	—
10/26/2023	Pending Home Sales MoM	-1.60%	—	-7.10%	—
10/26/2023	Pending Home Sales NSA YoY	—	—	-18.80%	—
10/26/2023	Kansas City Fed Manf. Activity	—	—	-8	—
10/27/2023	Personal Income	0.40%	—	0.40%	—
10/27/2023	Personal Spending	0.50%	—	0.40%	—
10/27/2023	Real Personal Spending	0.30%	—	0.10%	—
10/27/2023	PCE Deflator MoM	0.30%	—	0.40%	—
10/27/2023	PCE Deflator YoY	3.40%	—	3.50%	—
10/27/2023	PCE Core Deflator MoM	0.30%	—	0.10%	—
10/27/2023	PCE Core Deflator YoY	3.70%	—	3.90%	—
10/27/2023	U. of Mich. Sentiment	63	—	63	—
10/27/2023	U. of Mich. Current Conditions	—	—	66.7	—
10/27/2023	U. of Mich. Expectations	—	—	60.7	—
10/27/2023	U. of Mich. 1 Yr Inflation	3.80%	—	3.80%	—
10/27/2023	U. of Mich. 5-10 Yr Inflation	—	—	3.00%	—
10/27/2023	Kansas City Fed Services Activity	—	—	2	—
10/30/2023	Dallas Fed Manf. Activity	—	—	-18.1	—

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