China proposed to buy an additional $30 billion of US agricultural products a year as part of a deal that the two countries are currently working on in Washington this week. The US and China have started drawing up multiple memorandums of understanding over trade that would outline the basis of a final deal, marking the most significant progress toward an ending of the trade war. Chinese Vice Preimer Liu He is scheduled to meet with President Trump tomorrow which raised speculation that there might be an extension to the March deadline. Despite of the perceived progress in the trade negotiations, US stocks started today’s session in red, largely affected by economic data posted today. Treasuries edged lower and WTI crude also fell below $57 a barrel this morning. Yesterday, St. Louis Fed President Bullard added to the ongoing consensus of other Fed officials on an ending to its balance sheet normalization. While acknowledging his stance is in the minority on the FOMC, the voting member said current rates are too high.
The February Philadelphia Fed Business Outlook declined to -4.10 from 17.00 prior, marketing the lowest reading since May 2016. Initial Jobless Claims dropped to 216k from 239k prior vs. 228k consensus. Continuing Claims also fell to 1725k from 1780k revised prior vs. 1743k estimate. Primarily affected by the ongoing trade war, Durable Goods Orders in December came in below expectation of 1.70% at 1.20%. Bloomberg Consumer Comfort remained strong at 59.60 vs. 60.00 prior. Markit US Manufacturing PMI in February printed a slightly disappointing reading of 53.70 vs. 54.90 prior, marking the lowest reading since September 2017. Leading Index declined to -0.10% from flat revised prior. Lastly, Existing Home Sales fell to the slowest pace since November 2015 to 4.94 million. The US Treasury is scheduled to auction off $8 Billion of 30-YearTIPS at 10:00 AM (PT) today.
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China proposed to buy an additional $30 billion of US agricultural products a year as part of a deal that the two countries are currently working on in Washington this week. The US and China have started drawing up multiple memorandums of understanding over trade that would outline the basis of a final deal, marking the most significant progress toward an ending of the trade war. Chinese Vice Preimer Liu He is scheduled to meet with President Trump tomorrow which raised speculation that there might be an extension to the March deadline. Despite of the perceived progress in the trade negotiations, US stocks started today’s session in red, largely affected by economic data posted today. Treasuries edged lower and WTI crude also fell below $57 a barrel this morning. Yesterday, St. Louis Fed President Bullard added to the ongoing consensus of other Fed officials on an ending to its balance sheet normalization. While acknowledging his stance is in the minority on the FOMC, the voting member said current rates are too high.
The February Philadelphia Fed Business Outlook declined to -4.10 from 17.00 prior, marketing the lowest reading since May 2016. Initial Jobless Claims dropped to 216k from 239k prior vs. 228k consensus. Continuing Claims also fell to 1725k from 1780k revised prior vs. 1743k estimate. Primarily affected by the ongoing trade war, Durable Goods Orders in December came in below expectation of 1.70% at 1.20%. Bloomberg Consumer Comfort remained strong at 59.60 vs. 60.00 prior. Markit US Manufacturing PMI in February printed a slightly disappointing reading of 53.70 vs. 54.90 prior, marking the lowest reading since September 2017. Leading Index declined to -0.10% from flat revised prior. Lastly, Existing Home Sales fell to the slowest pace since November 2015 to 4.94 million. The US Treasury is scheduled to auction off $8 Billion of 30-Year TIPS at 10:00 AM (PT) today.
The curve has bear-steepened with UST 10-Year yield up 4.13 bps.