Despite the fair amount of listed indicators signaling a moderate level of risk, the overall risk of the economy remains relatively low as GDP continues to grow at a strong pace, unemployment remains low, and inflation remains near 2.00%.  However, treasury spreads remain historically very narrow and the CFNAI three-month average remains below zero, which warrants come caution.

Comments on this week’s report:

  • Treasury spreads remain historically very narrow as the 10-year minus 2-year spread and the 10-year minus 3-month spread sit at 0.21% and 0.11%, respectively.
  • GDP growth continues to grow at a relatively strong pace as it year-over-year growth rate increases from 2.97% to 3.21%.
  • Core Personal Consumption Expenditures (PCE), a measure of inflation, slowed as its annual growth rate dropped from 1.68% to 1.55% and now indicates a moderate level of risk.
  • New orders of durable goods was little changed and remains at a low level of risk as its year-over-year rate drops from 2.32% to 2.28%.
  • The University of Michigan’s Consumer Sentiment index increased from 93.80 to 98.40 and now indicates a low 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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