The Boock Report

Free Access

By

Inflation discussion

As we continue to see nominal interest rates melt away, we are also seeing a continued rise in inflation expectations and thus a further decline in real yields. After rising by 3 bps on Friday, the implied inflation rate in 10 yr TIPS rose another 3 bps yesterday. At 1.58%, that is the highest since late February when the conventional 10 yr yield stood at 1.70%. Thus, …

[Read more...] about Inflation discussion

By

Succinct Summation of the Week’s Events – 7/31

Positives 1)The always volatile Chicago manufacturing index for July spiked to 51.9 from 36.6 and that was well better than the estimate of 44. The caveat though from the Chicago MNI, "Nevertheless, companies noted continued uncertainty amid the ongoing Covid-19 crisis." Stating the obvious. 2)The July Richmond manufacturing survey rose 10 pts to 10 from …

[Read more...] about Succinct Summation of the Week’s Events – 7/31

By

Home sales/Sentiment

Pending home sales in June rose 16.6% m/o/m, a bit above the estimate of up 15% and follows the 44.3% spike in May as things reopened after 20%+ declines in March and April. This rebound takes the index to the highest level since 2006. The Northeast saw the best m/o/m gain but it is out West, down South and in the Midwest where the sales index is above where they were …

[Read more...] about Home sales/Sentiment

By

Succinct Summation of the Week’s Events – 7/24

Positives 1)June new home sales totaled 776k, 76k more than expected and up from 682k in May (revised a touch higher from 676k). All four regions saw increases with the biggest percentage happening in the Northeast (many leaving NYC?). Months' supply fell to 4.7, the lowest since 2016 as builders now need to scramble to catch up. This led to a 5.6% y/o/y …

[Read more...] about Succinct Summation of the Week’s Events – 7/24

By

Home closings

Existing home sales in June, reflecting many contract signings in the March thru May time frame, totaled 4.72mm, 30k less than expected but up from 3.91mm in May as things were only just reopening. This figured was 5.27mm in March and 5.76mm in February. As homes for sale didn’t keep up, months’ supply fell to 4.0 from 4.8 but that is where it was in April and above …

[Read more...] about Home closings

By

Succinct Summation of the Week’s Events – 7/17

Positives 1)Moderna, while still having to progress thru phase 3 trials, reported positive antibody results from phase 1 data and brings us a step closer to that hoped for vaccine. 2)Disney World, "the happiest place on earth", reopened.  3)Refi's bounced by 12% w/o/w and are up 107% y/o/y as mortgage rates took another leg lower, down by 7 bps on the …

[Read more...] about Succinct Summation of the Week’s Events – 7/17

By

Succinct Summation of the Week’s Events – 7/10

Positives 1)The Fed's balance sheet shrunk for the 4th week and is back below $7 Trillion. The main reason has been a reduction in swap lines (as they get paid back) and their repo facility usage has basically gone to zero. But, they keep on buying US Treasuries even with yields so low. 2)Initial jobless claims came in at a still high 1.31mm but that was below …

[Read more...] about Succinct Summation of the Week’s Events – 7/10

By

Succinct Summation of the Week’s Events – 7/2

Positives 1)The BLS said 4.8mm jobs were added back in June, well above the estimate of 3.23mm and the two prior months were revised up by a total of 90k. The biggest factor in the upside surprise was the almost 2.1mm jobs in leisure and hospitality that were brought back after an increase of 1.4mm in May and which followed a decline of 7.57 in April and drop …

[Read more...] about Succinct Summation of the Week’s Events – 7/2

By

Succinct Summation of the Week’s Events – 6/26

Positives 1)Reflecting the reopenings, spending rebounded in May by 8.2% m/o/m after the drop of 12.6% in April and 6.6% fall in March. With the revisions it was about as expected. The goods side led the rebound with a 14% gain after two months of 12% declines. Services bounced more modestly by 5.4% as that will take more time to recover. Personal income fell 4.2% …

[Read more...] about Succinct Summation of the Week’s Events – 6/26