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This week, markets will be looking for signals from the two-day FOMC meeting about a timetable for tapering of investments. Although it’s anticipated the Fed will not make any changes to policy at this meeting, committee members will update their forecast for growth, inflation, and employment.
The Fed is in a precarious position — if they signal tapering happening sooner, we could have a “taper tantrum” and bonds will sell off, increasing long-term yields. On the other hand, if the Fed is predicted to keep quantitative easing in place longer than anticipated, markets could rally, lowering long-term yields. This should make for an interesting market Wednesday afternoon.
|Dow Jones||S&P 500 E-Mini Future|
|NASDAQ Composite Index||CRB Commodity Index|
|US Bonds | FIT|
|T 0 1/8||5/31/23||0.157||99-29 1/8||99-30||– 00 5/8|
|T 0 1/4||6/15/24||0.326||99-24+||99-24 3/4||– 01 3/4|
|T 0 3/4||5/31/26||0.771||99-28+||99-28 3/4||– 05|
|T 1 1/4||5/31/28||1.175||100-15+||100-16||– 07|
|T 1 5/8||5/15/31||1.479||101-10+||101-11||– 08|
|T 2 1/4||5/15/41||2.093||102-16+||102-17+||– 17|
|T 2 3/8||5/15/51||2.168||104-15+||104-17||– 22|