Clarksville Weekly Market Snapshot from Frazier Allen for the week of September 28th, 2014
September 28, 2014
Clarksville, TN – The economic data were mixed. The estimate of second quarter gross domestic product (GDP) growth was revised upward from 4.2% to 4.6%, as expected.
Existing home sales fell in August, reflecting a decline in speculators (i.e., fewer all-cash transactions). New home sales surged 18.9%, but that likely reflects the usual volatility in the data.
Durable goods orders fell 18%, reflecting an unwinding of July’s sharp spike in civilian aircraft orders. The three-month averages of shipments and orders for nondefense capital goods (ex-aircraft) suggest good strength in business fixed investments.
Frazier Allen
Clarksville Weekly Market Snapshot from Frazier Allen for the week of September 21st, 2014
September 21, 2014
Clarksville, TN – Fed policymakers reduced the monthly pace of asset purchases (QE3) by another $10 billion, to $15 billion, on track to finish buying at the end of October. The Fed repeated that “it likely will be appropriate to maintain the current target range for the federal funds rate for a considerable time after the asset purchase program ends.”
Fed officials’ projections of the appropriate year-end federal funds target rate indicated that most expect to begin raising short-term interest rates sometime in 2015, but there was a wide range in the individual forecasts (and implicitly, in their expectations of when rates will start to rise – with most spread roughly evenly between March and September).
Frazier Allen
Clarksville Weekly Market Snapshot from Frazier Allen for the week of September 14th, 2014
September 14, 2014
Clarksville, TN – The economic data calendar was thin. Retail sales rose as expected in August. However, the figures for June and July were revised higher.
While the pace of consumer spending growth does not appear to be especially strong into 3Q14, it’s not terrible weak either (and certainly not as bad as the data suggested a month ago). Financial market participants didn’t seem to care much about the retail sales data.
Global anxieties receded a bit as the “no” vote for Scottish independence regained an upper hand in the polls. The markets didn’t react much to President Obama’s call for military action in the Middle East.
Frazier Allen
Clarksville Weekly Market Snapshot from Frazier Allen for the week of August 27th, 2014
August 27, 2014
Clarksville, TN – Market participants had expected Fed Chair Janet Yellen to adopt a decidedly “dovish” tone in her Jackson Hole speech.
However, Yellen presented a balanced assessment of the evidence and theories of labor market slack. While Yellen still sees plenty of labor market slack currently, she left the monetary policy outlook as an open question.
She repeated the notion (also included in the FOMC minutes) that the Fed could firm monetary policy sooner if the economy strengthens more than anticipated, but could also tighten more slowly if the economy disappoints.
Frazier Allen
Clarksville Weekly Market Snapshot from Frazier Allen for the week of August 3rd, 2014
August 3, 2014
Clarksville, TN – As was widely anticipated, the Federal Open Market Committee tapered another $10 billion from the monthly pace of asset purchases (now at $25 billion, with the program on track to be completed at the end of October).
The Fed provided no additional guidance on short-term interest rates, but repeated that the federal funds rate target would likely remain exceptionally low for “a considerable period” after the asset purchase program ends and that economic conditions will likely warrant a below-normal federal funds rate even as the Fed nears its employment and inflation goals.
Frazier Allen
Clarksville Weekly Market Snapshot from Frazier Allen for the week of July 27th, 2014
July 27, 2014
Clarksville, TN – The economic data were mixed. New home sales were much weaker than expected in June, with a sharp downward revision to May (March and April figures were also revised lower) – however, these figures are reported with an enormous level of uncertainty.
Existing home sales improved, with a further increase in the number of homes for sale. Durable goods orders rose moderately, but details showed a lackluster trend in shipments of nondefense capital goods. The Consumer Price Index rose 0.3% (+2.1% y/y), inflated partly by the seasonal adjustment for gasoline (which rose 0.3% before adjustment and +3.3% after adjustment). Ex-food & energy, the CPI edged up 0.1% (+2.0% y/y).
Frazier Allen
Clarksville Weekly Market Snapshot from Frazier Allen for the week of July 20th, 2014
July 20, 2014
Clarksville, TN – The retail sales and industrial production reports had similar stories – gains in June were disappointing relative to expectations, but figures for April and May were revised higher. These data (which are subject to revision) are consistent with a sharp rebound in economic activity in 2Q14 (following weather–related weakness in 1Q14), but also suggest some loss of momentum heading towards 3Q14.
The Producer Price Index and import price reports showed no appreciable pipeline pressures for inflation.
Frazier Allen
Clarksville Weekly Market Snapshot from Frazier Allen for the week of July 15th, 2014
July 15, 2014
Clarksville, TN – Next week, the economic calendar picks back up. Retail sales are likely to be the highlight, boosted by stronger vehicle sales in June. Ex-autos, sales results for April and May were disappointing – so we’ll be on the lookout for a rebound (or possibly some revision to the previous figures).
Industrial production data and residential construction figures have some potential to move the markets – they should point to stronger growth in 2Q14.
Frazier Allen
Clarksville Weekly Market Snapshot from Frazier Allen for the week of July 8th, 2014
July 8, 2014
Clarksville, TN – The June Employment Report was stronger than expected. Nonfarm payrolls rose by 288,000 (median forecast: +215,000), with widespread gains across sectors (April and May were revised a net 29,000 higher).
The unemployment fell to 6.1% (from 6.3%), although the employment/population ratio edged up only slightly (to 59.0%, vs. 58.9% in May and 58.7% a year ago – still suggesting plenty of slack in the labor market). Average hourly earnings rose 0.2% in June, up 2.0% y/y (the CPI rose 2.1% over the 12 months ending in May).
Frazier Allen
Clarksville Weekly Market Snapshot from Frazier Allen for the week of June 29th, 2014
June 29, 2014
Clarksville, TN – GDP growth was revised to a -2.9% annual rate in the third estimate for 1Q14 (vs. -1.0% in the 2nd estimate and +0.1% in the advance estimate).
Prior estimates showed that a slower rate of inventory accumulation and a wider trade deficit subtracted considerably from overall growth – the third estimate showed a somewhat larger subtraction of 3.2 percentage points from the headline GDP growth figure (Domestic Final Sales, GDP less net exports and the change in inventories, rose at a 0.3% annual rate).
Frazier Allen
