My WebLink
|
Help
|
About
|
Sign Out
Home
10C Consent
CityHall
>
City Clerk
>
City Council
>
Agenda Packets
>
2023
>
Packet 20230417
>
10C Consent
Metadata
Thumbnails
Annotations
Entry Properties
Last modified
3/21/2024 5:51:46 PM
Creation date
5/31/2023 11:56:27 AM
Metadata
Fields
Template:
CM City Clerk-City Council
CM City Clerk-City Council - Document Type
Staff Report
Document Date (6)
4/17/2023
Retention
PERM
There are no annotations on this page.
Document management portal powered by Laserfiche WebLink 9 © 1998-2015
Laserfiche.
All rights reserved.
/
47
PDF
Print
Pages to print
Enter page numbers and/or page ranges separated by commas. For example, 1,3,5-12.
After downloading, print the document using a PDF reader (e.g. Adobe Reader).
View images
View plain text
Economic Update <br /> <br /> <br /> <br />Market volatility has intensified as investors weigh the probabilities of a hard or soft economic landing.The strong labor <br />market has helped sustain economic growth,and inflation remains significantly higher than the Federal Reserve’s target. <br />Financial conditions have eased,and credit spreads have narrowed.Geopolitical risks remain as the Russia/Ukraine war <br />persists and China reopens,while domestically the debt ceiling risk has emerged.Market sentiment has shifted with the <br />resilient economic data thus far in 2023 and has converged with the Fed’s outlook for higher rates for a longer period.We <br />believe the Fed will continue to raise rates and maintain a higher terminal rate for an extended period until inflation <br />reaches the Fed’s target range. <br />As expected at the February 1st meeting,the Federal Open Market Committee (FOMC)raised the fed funds target rate by <br />25 basis points to a range of 4.50 -4.75%,in a continuing downshift from previous hikes.The decision was unanimous and <br />the statement reflects inflation is easing “somewhat.”The sentiment was hawkish, indicating that the extent of “ongoing <br />increases”in the fed funds rate will be data dependent.We believe the FOMC will continue to implement tighter monetary <br />policy at a slower pace and hold rates at restrictive levels for some time until inflationary pressures subside and remain in <br />the Fed’s target range. <br />In February,the yield curve inversion widened.The 2-year Treasury yield surged 62 basis points to 4.82%,the 5-year <br />Treasury yield increased 57 basis points to 4.18%,and the 10-year Treasury yield rose 41 basis points to 3.92%.The inversion <br />between the 2-year Treasury yield and 10-year Treasury yield increased to -90 basis points at February month-end versus - <br />69 basis points at January month-end.The spread was a positive 39 basis points one year ago.The inversion between 3- <br />month and 10-year treasuries narrowed to -89 basis points in February from -115 basis points in January.The shape of the <br />yield curve indicates that the probability of recession is increasing. <br />3
The URL can be used to link to this page
Your browser does not support the video tag.