by confoundedinterest17

What rates of interest are telling us is a nasty signal.

With an impending railroad strike that may torpedo the US economic system (but when that’s doable, why is the Biden Clan vacationing in Nantucket for Thanksgiving weekend when Joe ought to be speaking with railroads and the unions to not let this occur?), let’s see what rates of interest are telling us.

First, the US Treasury 10Y-2Y yield curve continues to descrend into the abyss (now at -80 foundation factors).

Second, the most recent Fed Dot Plot (from September, new one might be issued throughout December) present that The Fed thinks that their goal fee, whereas rising in 2023, will seemingly begin falling once more in 2024.

Third, since it’s Thanksgiving Day, US bond markets are closed. However in Europe, the 10-year sovereign yields are falling, an indication that the ECB is reversing course by rising financial stimulus and/or a European are decelerate.

Fourth, US mortgage charges have cooled since peaking (domestically) at 7.35% on November 3, 2022 and now sit at 6.81%, a decline of 54 foundation factors. A transparent signal of cooling.

Fifth, how about Fed Funds Futures information? It’s pointing to a peak Fed Funds Goal fee of 4.593% on the June FOMC assembly. Then a decline in charges to 2.301% by January 2024.

Now, go and revel in your Thanksgiving dinner with family and friends (up 20% since final 12 months), courtesy of Jerome Powell, Joe Biden, Nancy Pelosi and Chuck Schumer.


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