It has been an active week for economic markets, with several pivotal data releases making headlines. Let’s kick off with the non-farm payrolls report, a significant indicator of economic health, which was released last Friday. The report surprised to the upside, adding 272K jobs, a staggering 50% more than the anticipated 180K, showing resilience in the Job market.
On Wednesday, the Consumer Price Index or CPI, a key inflation report, was released in the morning, then in the afternoon, the FOMC delivered their summary of economic projections. CPI came in modestly lower than expected. Prices were anticipated to remain flat at a 3.4% increase YoY but came in slightly lower at 3.3%.
The Fed unsurprisingly left rates unchanged, but there was some adjustment in where Fed policymakers think the federal funds rate is headed. The Dot plot shows only 1 expected rate cut in 2024 vs. the 3 projected rate cuts in the last summary of economic projections.
Since these news releases, we’ve seen a rollercoaster ride in bond markets, with yields fluctuating in the double-digit range. While equity markets have shown resilience, mostly trending upwards. This volatility in yields and the upward trajectory of equity markets present a dynamic landscape for investors, with potential opportunities to be seized.
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