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Large U.S. companies have been on a bond issuance binge but this rapid pace in supply may be hard to sustain ahead of expected volatility related to extending the U.S. debt ceiling and another possible move higher in interest rates.
The U.S. Senate on Thursday was set to take up a bill to lift the government's $31.4 trillion debt ceiling, with just four days left to pass the measure and send it to Democratic President Joe Biden to sign, averting a catastrophic default.
Underlying inflation in the euro zone dipped by more than expected, though European Central Bank President Christine Lagarde said there’s “no clear evidence” that it’s peaked and pledged to lift interest rates further.
(Bloomberg) -- A rare European Central Bank warning about the bond market risk of a Bank of Japan policy change comes at a time when Japanese outflows from the region are already at record levels.
Federal Reserve Governor Philip Jefferson and Philadelphia Federal Reserve President Patrick Harker suggested Wednesday that the central bank could pause rate hikes at its next policy meeting. Jefferson, President Biden's nominee to be vice chair of the Fed's Board of Governors, noted that such a decision wouldn't necessarily mean the Fed was done hiking rates.
Global shares rose on Thursday as traders pared back expectations of a U.S. rate hike this month and were relieved by the passage through the U.S. House of Representatives of a bill to suspend the federal debt ceiling. A divided House passed a bill to suspend the $31.4 trillion debt ceiling - and avert a catastrophic default - with majority support from both Democrats and Republicans, stoking optimism that it can move through the Senate before the weekend.
“The task of the BRICS is to unite, not to divide. Therefore, when the BRICS countries decided to create the NDB, we pursued one simple goal: to create a financial institution for developing countries, so that we all have an additional tool to support our joint development agenda,” Siluanov said.
President Joe Biden and Speaker of the House Kevin McCarthy are each loudly proclaiming victory in the deal they finally struck this weekend to raise the debt ceiling. MARCUS: Let's be honest: this 11th-hour compromise was as inevitable as it is depressing, with no real winner, and just one big loser - the American people.
He sees a mild economic slowdown – more-so than a severe recession – due to his belief that central banks will pivot quickly if economic activity slows sharply. For that reason, he sees inflation remaining above 2% for a longer time as growth slows but doesn’t fully dip into recession, i.e. stagflation.
More, more, more. According to the New York Fed’s Quarterly Report on Household Debt and Credit, total household debt climbed to $17.05 trillion in the first quarter of 2023, an increase of $2.9 trillion since Q4 2019, shortly before the pandemic hit.
Most market participants are viewing a debt ceiling deal as bullish. While there may very well be a positive initial reaction, we expect a significant tightening of liquidity conditions in the coming months.
Let us hope that at least we Americans soon recover from our infatuation with government power.
Still an Astonishing Labor Market: Very Tight or Getting Even Tighter in Some Sectors...May 31, 2023 - 12:28:08 PDT
Powell is going to mention this with some frustration in his voice.
The Fed's latest beige book released this afternoon was a boring affair, one signaling the US economy remained sluggish at best, and describing economic activity as "little changed overall in April and early May." Four Fed districts reported small increases in activity, six no change, and two slight to moderate declines. Expectations for future growth deteriorated a little...
Leading into the weekend, where the debt ceiling had not been settled, markets were exhibiting very interesting positioning. To start, US Treasuries across the maturity spectrum were hugely out of favor. Net speculator positioning in options and futures were as short as they have every been. The charts below show the 2-year, 5-year and 10-year...
US large-cap indices are currently diverging from recessionary leading economic data. However, a decisive steepening in the yield curve leaves growth stocks and therefore the overall index facing lower prices.
May 31, 2023 - 08:58:46 PDT
China says it's now signed $582.3 billion worth of global currency settlement agreements that will exclusively utilize the yuan.
This cluster of large bankruptcies happening in less than forty-eight hours is the most since 2008. Libby Cherry writes for Bloomberg (reprinted on Time): “Firms across every sector are struggling with higher interest costs—making it more challenging to refinance loans and bonds—while corporate executives are drawing more scrutiny from investors and creditors.”
May 31, 2023 - 08:52:08 PDT
Under Biden, the US economy is a land of confusion. Under Biden’s Reign of Error, Mortgage Purchase Demand is down -44%, Refi Demand is down -87%, and Mortgage Rates are UP 106%.
As demographics continue to shift in the 21st century, the world’s aging population will continue to be a focal point for many global decision makers.