September 1, 2020 Headlines

Treasury yields rose overnight on better economic data from China and Japan but are catching a better bid in this morning’s trading session. Other than the Asian economic data, the news cycle is relatively quiet today. Fed Governor Lael Brainard will speak on the new monetary policy framework today. Brainard set the table for the shift average inflation targeting during a speech two months ago, and market participants will be listening for any hints regarding enhancements to the Fed’s forward guidance in the near future related to this framework change. Vice Chair Clarida spoke on the same topic yesterday, providing more reasoning/justification for the change without overtly acknowledging prior policy mistakes by the central bank. He also seemed to pour cold water on the Fed implementing yield curve control anytime soon, suggesting that doing so is complicated to implement and communicate. Clarida emphasized that forward guidance and asset purchases will continue to be the Fed’s preferred policy tools, but to be fair, the discussion of yield curve control in the June FOMC minutes was conditioned by the premise that forward guidance was no longer “credible on its own.”

Jason Haley
Chief Investment Officer

8/31/20Dallas Fed Manf. Activity08-3
9/1/20Markit US Manufacturing PMI53.653.6
9/1/20ISM Manufacturing54.854.2
9/1/20ISM New Orders58.861.5
9/1/20ISM Prices Paid5453.2
9/1/20ISM Employment44.3
9/1/20Construction Spending MoM1.00%-0.70%
9/1/20Wards Total Vehicle Sales14.90m14.52m
9/2/20MBA Mortgage Applications-6.50%
9/2/20ADP Employment Change1000k167k
9/2/20Factory Orders6.10%6.20%
9/2/20Factory Orders Ex Trans4.40%
9/2/20Durable Goods Orders11.20%11.20%
9/2/20Durables Ex Transportation2.40%2.40%
9/2/20Cap Goods Orders Nondef Ex Air1.90%1.90%
9/2/20Cap Goods Ship Nondef Ex Air2.40%
9/2/20U.S. Federal Reserve Releases Beige Book
9/3/20Challenger Job Cuts YoY576.10%
9/3/20Nonfarm Productivity7.50%7.30%
9/3/20Unit Labor Costs12.00%12.20%
9/3/20Initial Jobless Claims950k1006k
9/3/20Continuing Claims14000k14535k
9/3/20Trade Balance-$58.0b-$50.7b
9/3/20Bloomberg Consumer Comfort44.3
9/3/20Markit US Services PMI54.754.8
9/3/20Markit US Composite PMI54.7
9/3/20ISM Services Index5758.1
9/4/20Change in Nonfarm Payrolls1370k1763k
9/4/20Two-Month Payroll Net Revision17k
9/4/20Change in Private Payrolls1288k1462k
9/4/20Change in Manufact. Payrolls55k26k
9/4/20Unemployment Rate9.80%10.20%
9/4/20Average Hourly Earnings MoM0.00%0.20%
9/4/20Average Hourly Earnings YoY4.40%4.80%
9/4/20Average Weekly Hours All Employees34.534.5
9/4/20Labor Force Participation Rate61.80%61.40%
9/4/20Underemployment Rate16.50%




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