Morning Market Update: November 14, 2019


Treasury Yields Fall as Equities Rise

Commentary for Wednesday: Treasuries rallied modestly, while equities increased. Yields were steady in overnight trading with little news. They fell sharply in the early morning following the release of Chinese economic data suggesting rising inflation and currency volatility. Yields were mixed through the rest of the day, and slightly rebounded near the close. However, yields ended down 2-5 basis points across the curve.              

This Morning:
Yields declined this morning after the economic data release on  the Producer Price Index (PPI)  beat consensus expectations.

The MBA reported mortgage applications rose 9.6% week-over-week ending November 8, after falling 0.1% the week prior. The increase as attributed to purchased rising 5.1% and refinances increasing 12.9%. The average 30-year fixed rate mortgage is 4.03%.

The Consumer Price Index beat expectations of 0.3% growth by increasing 0.4%, after growth was unchanged the month prior. The spike was driven by a seasonally adjusted spike in gasoline. Core inflation slowed on a year-on-year basis to 2.3% from 2.4% roughly in-line with the Fed's preferred metric.

The Treasury budget statement for October showed a growing deficit above consensus expectations to a reading of -$134.5B. Last month showed a surplus of $82.8B. Receipts fell 2.8% year-over-year while outlays rose 7.6% year-over-year.               


Financial Markets Research


The morning market update is provided by: 

solutionsheadshots_hotchkiss_smJames Hotchkiss
Director, Member Strategy and Solutions

SolutionsHeadshots_Deven_smMelissa Deven
Director, Member Strategy and Solutions


The data and valuations provided in this document are for information purposes only and are provided as an accommodation and without charge. The Federal Home Loan Bank of Chicago makes no representations or warranties about the accuracy or suitability of any information in this document. This document is not intended to constitute legal, investment, or financial advice or the rendering of legal, consulting, or other professional services of any kind.

Contact your Sales Director for more information.

*Required Fields