Economic Commentary Articles for Advisors

Fed moves to an easing bias

June 24, 2019

While the Fed kept interest rates unchanged at the June FOMC meeting, there were significant changes to the policy statement, the Summary of Economic Projections (SEPs), and Chairman Powell's press conference – all of which were quite dovish. While a near-term rate cut has yet to be confirmed, there was a definite easing bias in the communication with many Fed officials viewing lower rates as necessary to sustain economic growth in light of risks associated with trade/tariff tensions and slower growth abroad, as well as to boost inflation expectations which remain stubbornly below the Fed’s 2.0 percent goal.

Economic commentary

June Economic Review: Trade disputes impact U.S. and global economies

June 19, 2019

The rising rift between the U.S. and China/Mexico sparked a sharp drop in equity markets across the globe last month. As the trade war escalates and expands, the toll on the U.S. economy – reducing growth and raising inflation – will continue to build. See Nationwide Economics’ take on what's happening and why this month in the economy.

Economic commentary

Consumers still leading the way forward

June 17, 2019

Building fears of a sharp slowdown for the economy are being refuted by solid consumer data. Retail sales rose by 0.5 percent for May, a solid rate that suggests that job gains and accelerating wages continue to drive consumer spending. Moreover, April data – originally reported as falling by 0.2 percent – were revised upward to an increase of 0.3 percent. Core retail sales were up by 0.5 percent for May as well, showing that spending gains were widespread across categories.

Economic commentary

A very mixed week for the economy

June 10, 2019

As the current economic expansion nears record length, last week’s economic data were decidedly mixed: auto sales soared, business surveys were down (manufacturing) and up (services), the monthly jobs report was a clunker, and Federal Reserve policy makers acknowledged market concerns over weaker data. But the week ended late on Friday with potentially very positive news.

Economic commentary

What’s up with bonds?

June 4, 2019

Prices for U.S. Treasury securities have been soaring over the past week, driving yields down (there is an inverse relationship between bond prices and yields). On Tuesday, May 21 the yield on the 10-year Treasury note closed the trading day at 2.43 percent. On Friday, May 31 the yield dropped to under 2.14 percent – the lowest level since rates were briefly a bit lower in September 2017.

Economic commentary

Curve inverted again on trade concerns

May 28, 2019

Worsening tariff/trade worries continued to agitate financial markets as investors fear the impact of protracted trade disruptions for the global economy. The S&P 500 stock index dropped for a third consecutive week, falling by an additional 1.2 percent. Still, the recent declines have been modest so far with the index down by just over four percent from its peak at the end of April.

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