Weekly economic review & outlook
Trade/growth concerns lead to sharp rate declines
AUG. 12, 2019
You Need to Know
Week in review
Market fears send investors into Treasuries
The 10-year Treasury note yield dropped to three-year lows last week as trade/currency turmoil between the U.S. and China roiled markets.
Portions of the yield curve remain inverted despite the Fed’s rate cut in July
A key warning signal for the end of the expansion continues to flash red even as the Fed tries to prop up the economy.
Consumer inflation likely to rise modestly in July
The overall and core CPI should climb around trend at 0.2 percent for July – keeping year-over-year inflation readings at still modest levels.
Solid retail spending expected again for July
Despite a decline for autos, retail sales should extend their solid trend in July, fed by rising incomes and job growth for consumers.
The equity market selloff that started the previous week intensified early last week as China responded to the latest round of U.S. tariffs by allowing the yuan to depreciate and stating intentions to cease U.S. agricultural purchases. While trade tensions remain at a fever pitch, major domestic equity indices had rebounded with most posting only slight declines for the week.