Economic and Fixed Income Insights, August 6, 2019

A re-escalation of trade tensions between Washington and Beijing has continued to fuel a sell-off in global equities which began after the Federal Reserve signaled the cycle’s first rate cut last week was a preventative “mid-cycle” move. In other economic news, mortgage applications increased 5.3 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending August 2, 2019. Rates have plunged as investors seek safety from global growth fears after a recent round of rate cuts from the U.S. and other central banks. The benchmark ten-year UST yield has dropped 36 basis points to its lowest level in nearly three years.  Tax-exempt yields also trended drastically lower while under-performing Treasuries.

Interest Rate Observations

Source: Thomson Reuters, Bloomberg. The table above reflects market conditions as of August 6, 2019.

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.

 

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