inflation

May 7 2018

Why Is Everyone Talking About the 10-Year Treasury?

Below is a synopsis of this investment report:

The new headline this week centered on the 10-year U.S. Treasury yield, which rose slightly above 3% intraday for the first time since January 2014. The 10-year U.S. Treasury is a yardstick used to gauge long-term growth and inflation expectations and thus serves as a key indicator of where the U.S. economy is heading.
The markets, which have been lethargic, sold off as they digested the news on concerns that higher interest rates could start eating into corporate profits and potentially signal more inflation.
There is little debate that the economic expansion is classified as “late-cycle,” but that does not mean it must come to an early end. With the passage of the Tax Cuts and Jobs Act late last year, growth could accelerate throughout 2018, suggesting the end is not upon us just yet.

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March 9 2018

Below is a synopsis of this investment report:

The markets sold off in February on concerns that the strong economy may overheat, inflation may spike, and the Federal Reserve (Fed) may then raise interest rates more aggressively to try to combat higher inflation.
Inflation has been below the Fed’s target of 2% for years, and the Fed gave little hint in its latest report to Congress that it is prepared to raise U.S. interest rates more aggressively in 2018.
Investors should focus on indicators such as consumer spending, economic growth as measured by Gross Domestic Product (GDP), corporate earnings results, and the Fed’s monetary policy – all of which currently point to the economy’s ability to digest price increases. Inflation and resulting price increases need not be significant concerns if we have a healthy and growing economy.

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January 27 2015

Below is a synopsis of this investment report:

Conservative investors are anxious to return to the days when bank CDs and money market funds could be used to generate low-risk returns.
Although it’s impossible to time when the Fed will move to raise interest rates, it’s likely not happening in 2015 due to inflation expectations and a stronger U.S. dollar.
The ironic reality for conservative investors is that the first interest rate hike by the Fed is almost meaningless to the near-term returns on cash investments

For full access to the investment report titled “When Will Interest Rates Rise?”, please contact us.