Economic and Fixed Income Insights – April 11, 2018

Economic and Fixed Income Insights

The consumer price index (CPI) fell 0.1% in March, the first monthly decline in 10 months, and following a 0.2% increase the month prior. Year-over-year however, headline consumer prices rose 2.4% in March as expected, according to Bloomberg. This provides some support for those at the Fed looking for meaningful rise in prices. However, this trend in prices will need to be maintained in order to justify additional rate hikes in the future. Markets remain volatile on easing trade rhetoric between the world’s two largest economies and fresh tension in the Middle East. Bond yields ended the week slightly lower along most of the curve. The 10-year UST finished 2 basis points higher at 2.80%, and the 30-year UST was down one basis point to 3.02%.   Tax-exempt yields continued to trend downward, with both the 10-year and 30-year MMD 3 basis points lower for the week, following a decline of 5 basis points the week prior.

Interest Rate Observations

Benchmark Current Previous

Week

(+/-) Change Previous

Year

(+/-) Change
10-Year UST 2.80% 2.78% 2 2.24% 56
30-Year UST 3.02% 3.03% (1) 2.89% 14
10-Year MMD 2.43% 2.46% (3) 2.12% 31
30-Year MMD 2.96% 2.99% (3) 2.94% 2
Federal Funds Rate 1.75% 1.75% 0 1.00% 75
1-month LIBOR 1.89% 1.88% 1 0.99% 90
SIFMA 1.60% 1.58% 2 0.89% 71
10-year LIBOR Swap 2.83% 2.79% 4 2.20% 63

Source: Thomson Reuters, Bloomberg. The table above reflects market conditions as of April 10, 2018

Important Disclosures

This material was prepared by Stifel, Nicolaus & Company, Incorporated (“Stifel”). This material is for informational purposes only and is not an offer or solicitation to purchase or sell any security or instrument or to participate in any trading strategy discussed herein. The information contained is taken from sources believed to be reliable, but is not guaranteed by Stifel as to accuracy or completeness. Past performance is not necessarily a guide to future performance. Stifel does not provide accounting; tax or legal advice and clients are advised to consult with their accounting, tax or legal advisors prior to making any investment decision.

 

Stifel, Nicolaus & Company, Incorporated is a broker-dealer registered with the United States Securities and Exchange Commission and is a member FINRA, NYSE & SIPC. © 2018