The overall risk of the economy remains moderately higher than it has in the more recent past, but still shows a relatively low amount of risk.  Despite most of the listed indicators showing a “moderate” or “low” level of risk, some vigilance is warranted as the yield curve remains relatively flat and CFNAI remains below zero.

Comments on this week’s report:

  • Treasury spreads remain historically very narrow as the 10-year minus 2-year spread and 10-year minus 3-month spread sit at 0.18% and 0.15%, respectively.
  • Housing starts continue to fall as its year-over-year rate of change dropped from -11.47% to -14.17%, and shows a moderate level of risk.  Should housing starts continue this trend, a high level of risk may be warranted and thereby should be more closely monitored.
  • Growth in total business inventories dropped slightly as its year-over-year change fell from 5.21% to 4.92%, but still shows a low level of risk.
  • The St. Louis Fed Financial Stress Index continues to trend lower as it drops from -1.27 to -1.31 as it nears all-time lows and shows virtually no level of risk.
Please Note: Due to various factors, including changing market conditions, this content may no longer be reflective of current opinions or positions. This report is for informational purposes only and should not be regarded as a substitute for independent research and personalized investment advice.

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