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April 6, 2020

Treasury Yields Rise as President Trump Sees Outbreak Slowing Down

 

US economy falters as President Trump warns the next two weeks will be be a "very deadly period." ." Last month alone, US employers slashed 701,000 jobs with two-thirds of the cuts occurring in the leisure and hospitality industry according to the US Labor Department. Moody's analytics estimates that US daily output has fallen around 29% compared with the first week of March. There are some signs that the domestic outbreak is beginning to slow down- deaths in New York falling to 594 after peaking over on Friday....

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April 3, 2020

Nonfarm Payrolls Shrink by 701,000 to End 113 Months of Consecutive Growth

 

Pandemic crushes employment figures. This morning the Labor Department reported nonfarm payrolls shrinking by 701,000 during the month of March, effectively ending 113 consecutive months of growth. Additionally, the unemployment rate rose to 4.4% from 3.5%, the highest level since August 2017. There remains a large population of market pundits that feel we are just beginning to see the impact of COVID-19 in US economic data, with the worst yet to come -- Oxford Economics estimates 27.9 million lost jobs and an...

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April 2, 2020

Fed Eases Bank Capital Requirements as COVID-19 Continues to Disrupt Markets

 

The Fed announced measures to temporarily ease capital requirements for big banks. On Wednesday, the Fed relaxed rules around how big banks account for UST holdings and deposits held at the central bank by excluding them from the supplementary leverage ratio calculation – a measure of capital as a percentage of loans and other assets. The loosening of the ratio calculation is meant to further promote banks’ lending to consumers and businesses who are struggling from the pandemic fallout. Boston Fed President Eric...

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April 1, 2020

Rates Fall Across the Curve as White House Discusses Additional Stimulus

 

President Trump calls for $2T in federal infrastructure spending. President Trump stressed the importance of a significant investment in infrastructure in the next bill when he tweeted "It should be VERY BIG & BOLD, Two Trillion Dollars, and be focused solely on jobs and rebuilding the once great infrastructure of our Country!" Despite the promise of more government spending, US Treasury yields ended mostly lower across the curve yesterday as COVID-19 cases continue to climb- most experts saying that the peak...

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March 31, 2020

Rates and Equities Rise as Congress and White House Discuss Additional Stimulus

 

White House and Congress discuss additional stimulus package to blunt economic impact of COVID outbreak. Senate Minority Leader Chuck Schumer hinted "this is certainly not the end of our work here in Congress - rather the end of the beginning." One point of focus for both Congress and President Trump is increased aid for state governments, particularly as tax revenues plummet and spending demands ramp up. House Speaker Nancy Pelosi added that "next we'll go from emergency mitigation to recovery...to grow the...

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March 30, 2020

Fed Brainstorms Additional Aid Packages for Small Businesses and States

 

President Trump looks to the Fed for additional aid after signing a $2T stimulus package. After passing through the House on Friday, President Trump signed the $2T stimulus bill which includes tax breaks and direct payments to Americans impacted by the virus. The economic rescue legislation also asks the Fed to provide financing to businesses, states, and cities. Over the last two weeks, the Fed has created over half a dozen emergency lending programs to ensure the US financial system has enough liquidity. Fed...

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March 27, 2020

House Votes in Favor of $2T Stimulus Package

 

Market volatility persists as coronavirus cases continue to grow in the US. Helping to try and curb economic concerns, today the House formally voted in favor of the $2T stimulus package, with President Trump’s signature expected later this evening. This fiscal stimulus supplements the Fed’s recent actions - cutting their benchmark rate to zero, creating numerous lending programs, and signaling to the markets that "when it comes to this lending, we're not going to run out of ammunition. That doesn't happen."...

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March 26, 2020

Weekly US Jobless Claims Surge to 3.28 Million

 

Increased global measures are being taken to curb the impact of the virus. In the US, the Senate officially approved the $2T stimulus bill overnight in a unanimous vote. The bill includes loans to businesses, tax breaks, and direct payments to Americans. The House is scheduled to vote on the bill tomorrow, with President Trump insisting he would sign it immediately. This provided some relief to markets after Fed Chair Jerome Powell said that the US economy "may well be in a recession," but "the virus is going to...

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March 25, 2020

Senate Agreement on $2T Stimulus Package Spurs Market Optimism

 

The Senate reached a deal on a stimulus package. Senators and the Trump Administration reached an agreement overnight on a $2 trillion stimulus package aimed at curbing the virus impact on the US economy. The package includes tax breaks, direct payments to Americans, an expansion of unemployment insurance, and $350 billion in aid to small businesses. The bill is currently being drafted and will be voted on later today. Lawmakers and optimistic that the bill will substantially aid those affected by the outbreak,...

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March 24, 2020

US Treasury Yields Fall as Senate Fails to Pass Stimulus Package

 

Markets were rattled yesterday as the Senate failed to agree on a stimulus package. House Speaker Nancy Pelosi proposed a $2.5 trillion stimulus bill which includes supporting home owners and renters as well as student debt forgiveness up to $10,000. The House will not yet vote on these measures as they must be included in the Senate bill. Democrats voted against the bills proposed Sunday and Monday, voicing their disapproval that the majority of funds would be allocated towards large corporations rather than...

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