4 min readTariffs Not Yet Impacting Inflation; & Softening Labor Market For the 4th month in a row, both headline and core CPI came in lower than expectations, suggesting companies have not yet passed tariff-driven price increases to consumers. For May, both readings came in at +0.1%; year-over-year CPI rose to 2.4%, while Core-CPI held at +2.8% for…
4 min readRisk-on Tone In Markets After US/China Tariff Reprieve On May 12th, the United States and China issued a joint statement announcing a 90 day tariff reprieve. The U.S. reduced its levies from 145% to 30%, while China dropped theirs from 125% to 10%. This was seen as a significant de-escalation between the two countries, creating…
4 min readDecent Underlying GDP Data Despite A Negative Headline Q1 2025 GDP contracted for the first time since 2022 on a pre-tariff import surge of 41.3%, the 2nd largest quarterly jump in the past 50 years. Since these goods and services are not produced here in the United States, they are subtracted from the GDP calculation,…
3 min readMarkets Stabilize Following Tariff Announcements It has been a historic month for global markets due to the Trump administration’s on-again/off-again tariff announcements. Despite the recent volatility, we are seeing signs that markets may be stabilizing: Source: Bloomberg Volatility Leads to Dip Buying Although money market fund assets have increased to over $7 trillion, there was…
3 min readQ1 2025: The Trump Trade Unwound on Tariff Concerns First quarter market activity was driven by tariff headlines along with increased fears of inflation and slowing growth. These concerns fueled a significant drop in consumer sentiment, which led Treasury yields to rally and U.S. equities to decline (see charts below). The first three months of…
3 min readTariffs & Government Spending Cuts Stoke Stagflation Fears Concern is increasing that global trade tensions along with government spending cuts could lead to slower growth and higher prices if tariffs remain in place. Many economists have recently lowered US growth outlooks. Even commentary from President Trump and Treasury Secretary Bessent signal some pain ahead: Trump…
4 min readYields Declined on Negative Consumer Outlook Treasury yields declined significantly towards the end of February after two consumer survey reports came in much lower than expected. The drops were most significant in the long end, with the 10-year yield declining 33 basis points, while the 2-year yield fell below 4% for the first time since…
4 min readMixed Data Keeping the Fed on Hold Fed Chair Powell recently said he wants “to see inflation behaving in a way that builds confidence that we are really making progress.” Unfortunately, the January Consumer Price Index (CPI) did not build any confidence that inflation is decelerating, coming in much higher than expectations. Overall, data releases…
4 min readDespite a Wild January, Treasury Yields Ended Little Changed This past January will be one that many of us will never forget. The month started with massive wildfires in Southern California, the inauguration of President Trump, DeepSeek’s disruption of the technology sector, and the first U.S. commercial airline crash since 2009. At month-end, the markets’…
3 min readGovernment Bond Yields Rise Globally The rise in U.S. treasury yields has continued into the new year, primarily driven by 3 factors: A string of solid U.S. releases has continued, with both the ISM Manufacturing & Services reports coming in better than expected, the December nonfarm payrolls beating expectations by nearly 100,000, and the unemployment…