Strong Data Dampens Rate Cut Expectations, Lifts Dollar And Spurs Treasury Yields: Thursday's Economic Digest
Portfolio Pulse from Piero Cingari
The U.S. Dollar Index (DXY) and U.S. Treasury yields rose due to strong economic data, reducing expectations for a Federal Reserve rate cut. Jobless claims dropped more than expected, and building permits exceeded estimates, while housing starts declined but still beat forecasts. The Philly Fed Manufacturing Index improved but remained in contraction. These indicators suggest a resilient economy, potentially affecting the Federal Reserve's interest rate decisions and providing opportunities in the homebuilder sector.
January 18, 2024 | 3:45 pm
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The U.S. Treasury Note ETF (UTEN) saw its tracked 10-year Treasury Note yields hit over a month's high, potentially attracting investors seeking higher fixed-income returns.
The increase in Treasury yields, as tracked by UTEN, is a direct result of the strong economic data. Higher yields may attract investors to the ETF in the short term as they seek to capitalize on the increased returns from fixed-income securities.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80