Joseph Trevisani's Blog (42)

Market Volatility Spikes on British Vote, Fed Rate Reluctance

Equities, currencies and interest rates gyrated, crude oil fell, German yields moved further into the negative and the CBOE volatility Index spiked to its highest in four months as markets tried to price the potential of a U.K. departure from  the European Union. 

Over the past two weeks polls have moved substantially in favor of a British exit with the so-called 'Brexit' vote leading between one to ten percentage points for the vote on next Thursday June 23rd. 

Equites had…

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Added by Joseph Trevisani on June 16, 2016 at 8:49pm — No Comments

Fed Signals December Hike is Possible, Yes, Likely? Maybe

Janet Yellen and William Dudley are trying their best to convince the markets that a December increase in the Fed Funds rate is, as the Fed Chair said Wednesday in Washington, a "live possibility."  

Credit markets have responded smartly to the assertions of Chair Yellen and New York Fed President Dudley. The yield on the 2-year generic Treasury closed at 0.8116 percent on Wednesday, the highest since April 11th. On Thursday it traded to 0.8575 percent in New York, a four…

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Added by Joseph Trevisani on November 5, 2015 at 8:01pm — No Comments

Japanese Exports, Imports Drop in September

Japanese exports, once the mainstay of its economy, grew at the slowest rate in thirteen months and imports tumbled pointing to a decline in domestic consumption that could tip the island nation into recession. 

The decline in exports, which have been falling for most of the year, combined with poor results in industrial production, capacity utilization, machine and machine tool orders and a sharp drop in inflation this year will inform the Bank of Japan's October 30th meeting, widely…

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Added by Joseph Trevisani on October 21, 2015 at 10:04pm — No Comments

China's GDP Growth Falls below 7 Percent, but by How Much?

China joined the United States and Japan in relative decline in the third quarter leaving the European Monetary Union as the sole major economic bloc expecting stronger economic growth in 2015.

Gross domestic production expansion in the world’s second largest economy dropped to a 6.9 percent annual rate, better than the 6.8 percent forecast, but still the slowest pace since the financial crisis. It was the second weakest quarterly average in more than 20 years. Since 1992 only the…

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Added by Joseph Trevisani on October 20, 2015 at 4:00pm — No Comments

The US Consumer is at the Bank not the Mall

Despite repeated predictions by economists of the imminent rescue of the U.S. economy by free-spending consumers, American households are acting as if the improving labor market and lower gasoline prices are reasons not to splurge but to retire debt and save for a increasingly dicey future. 

Retail sales were flat in April after a 1.1% increase in March that was larger than initial 0.9 percent release, according to the Commerce Department in Washington today. Analysts in the Bloomberg…

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Added by Joseph Trevisani on May 14, 2015 at 4:01pm — No Comments

Greek Negotiations Stumble Along, ECB Spares Banks

The immediate veto to Greek membership in the euro belongs to the Europe Central Bank. Mario Draghi again stayed its hand today as Athens continued its debt battle with its European partners.

The ECB's governing council raised the cap on its liquidity lifeline to Greek banks by 1.1 billion euros ($1.2 billion) to 80 billion euros keeping the Greek banking system solvent as massive withdrawals continue to deplete its capital base.

Without this liquidity support the Greek banks…

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Added by Joseph Trevisani on May 12, 2015 at 5:30pm — No Comments

Sterling Gyrates in UK Election Suspense

The British Pound sold off sharply twice and recovered as traders await the results of the British general election. The contest between the Conservative Prime Minister David Cameron and Labor opponent Ed Miliband has the potential to prompt sweeping changes in the relationship between the United Kingdom and Europe and within the U.K. itself.

Neither candidate appears to have an edge going into today’s polling, with the next Prime Minister likely to be determined by the results for…

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Added by Joseph Trevisani on May 7, 2015 at 6:40pm — No Comments

US Factory Orders Beat Forecast, Revisions Weaker

Orders to U.S. factories rose in March for the first time in eight months, but the transportation sector aside, the underlying environment remains weak and the negative revision to February's orders could impact first quarter GDP.

After last year’s poor January factory number, orders then rebounded strongly in February and March rising a total of 3 percent and hinting at the time, that the economy would stage a strong recovery in the second quarter.

In the event GDP last year…

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Added by Joseph Trevisani on May 4, 2015 at 4:25pm — No Comments

US Jobs Are There, Aren't They?

The number of unfilled American jobs climbed by 168,000 to 5.13 million in February, the second highest total in the 15 year history of this series, according to the Bureau of Labor Statistics on Tuesday. Analysts had expected 5.07 million positions, following January's revised 4.97 million openings. 

The Job Opening and Labor Turnover Survey tracks the number of  specific job openings in the U.S. economy including newly created and unoccupied positions for which employers are seeking…

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Added by Joseph Trevisani on April 7, 2015 at 7:00pm — No Comments

European Debt Poker

He who can destroy a thing can control a thing.                                                                         Dune, Frank Herbert 

The dispute between Greece and its European lenders has not yet reached the point where the parties are frankly contemplating the results of their own intransigence.  

Greece wants to remain within the euro but end…

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Added by Joseph Trevisani on February 13, 2015 at 4:43pm — No Comments

U.S. Economic Expansion Moderates, Consumers Splurge

The growth rate of the  United States economy fell by almost half in the fourth quarter as sliding government expenditures,  ebbing business investment and rising imports subtracted from the largest jump in consumer spending in more than eight years and substantial build in inventories.

Gross domestic product t, the widest measure of economic activity, fell to 2.6 percent annualized in the final three months of last year, from 5 percent in the previous quarters according to Commerce…

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Added by Joseph Trevisani on January 30, 2015 at 8:10pm — No Comments

The Lure of the Normal, Deflation and U.S. Monetary Policy

The Federal Reserve has been hinting at a 2015 rate hike since Ms Yellen’s first official news conference in March when she incautiously suggested  that the first increase in the Fed Funds rates could come ‘six months’ after the end of quantitative easing.  Ms Yellen used the mirror image of that formulation on Wednesday when she said that the Fed was unlikely to start a rate cycle for “at least the next couple of meetings.”

It is clear the Fed would like to start a cautious rate…

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Added by Joseph Trevisani on December 22, 2014 at 5:15pm — No Comments

When Will He? The Coy Stanley Fischer

Federal Reserve Vice Chairman Stanley Fischer is being coy. He said on Tuesday that the central bank is moving close to signaling the end of zero rates, but he declined to speculate on timing.

Of course by talking about an impending bank notice for a rate hike, Mr. Fischer is signaling the same.  

"If the labor market continues to strengthen, and if we…

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Added by Joseph Trevisani on December 3, 2014 at 4:00pm — No Comments

German Business Confidence Recovers, EMU Economic Growth Erratic

The outlook of Germany's business executives unexpectedly revived after six straight months of decline encouraged by the return of economic growth and the European Central Bank's new focus on stimulus.

The Ifo Institute's business climate index rose to 104.7 in November from 103.2 in October for the first gain since April.  Analysts in the Bloomberg survey had predicted a slight drop to 103.0.

Germany's economy had contracted 0.1 percent in the second quarter exciting fears…

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Added by Joseph Trevisani on November 24, 2014 at 7:23pm — No Comments

GDP Contracts the most in Five Years, Durable Goods Dissapoint

In the largest second quarterly GDP revision in history annual  U.S. economic growth was revised down to -2.9 percent in the first quarter  by the  Bureau of Economic Analysis of the Commerce Department in Washington, D.C. 

It was the worst three month performance since the first quarter of 2009 when the economy contracted 5.4 percent and had yet to exit a year long recession.  Growth has now been adjusted a total of 3.0 percent lower. The first estimate of 0.1 percent was reported…

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Added by Joseph Trevisani on June 25, 2014 at 6:32pm — No Comments

US Data Boosts Dollar against Euro and Yen

Robust homes sales and consumer confidence gave the dollar an extended push in New York trading, though it remains close to the mid-point of its range for the past two weeks against the euro.

Sales of new American homes surged 18.6 percent in May to 504,000 at an annual rate, well beyond the 439,000 forecast and the highest total in six years.  The Conference Board index of consumer confidence, released at the same time as the housing information, registered 85.2 for June the…

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Added by Joseph Trevisani on June 24, 2014 at 6:44pm — No Comments

US Housing Starts and Population

Housing starts are a good barometer for the construction industry's contribution to national economic activity. When the industry's recent performance is compared to its historical trends rather than to just the years after the 2008 recession, it is clear that the industry remains mired in a profound slump. Last year it contributed less than half its potential to the U.S. economy.

Construction started on 1.072 million homes at an annualized rate in April. That is 22 percent below the…

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Added by Joseph Trevisani on May 19, 2014 at 3:30pm — No Comments

American Retail Sales Stall, Second Quarter Growth Looking Frail

Retail sales nudged higher in April despite a stronger than expected lead in from March, casting doubt on the idea that the economy will accelerate in the second and third quarters.

Sales moved up just 0.1 percent on the month according to the Commerce Department, one fourth of the median 0.4 percent prediction. The March gain was revised up to 1.5 percent from 1.1 percent, the strongest monthly rise four years.

Retail sales excluding automobiles and parts were flat in April…

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Added by Joseph Trevisani on May 14, 2014 at 10:00pm — No Comments

Which Way for the US Economy: Philadelphia Fed Rises, New York Falls

Factory production in the mid-Atlantic region expanded in April at the fastest pace in seven months, but across the Delaware River in the New York Fed growth slowed to its lowest level since last November. 

The Philadelphia Fed Business outlook Index came in at 16.6 well above the 10.0 forecast and almost doubling March's 9.0 reading. The Philadelphia Federal Reserve region comprises the eastern two thirds of Pennsylvania, Delaware and Southern New Jersey.

In New York the story…

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Added by Joseph Trevisani on April 17, 2014 at 7:35pm — No Comments

Euro and Equities Remains Strong as Putin Reassures West

The bland response of the United States and Europe to the Russian takeover of Crimea has reassured the currency and equity markets that there will likely be no economic or financial dislocation from the secession of the Black Sea peninsula from Ukraine or from the intended Russian annexation.…

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Added by Joseph Trevisani on March 18, 2014 at 8:06pm — No Comments

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