DoubleLine’s Post

TGIF : ROAD TO RATE CUT IS GETTING CLEARER.. 👏 US is making significant strides in its battle against inflation, potentially paving the way for the Fed to lower interest rates, which impact everything from mortgages to credit card payments. Lemme give a brief summary of June CPI : ✍ Headline CPI : Increased by 3% YoY (May: 3.3%, Consensus: 3.1%), but declined by 0.1% MoM. ✍ Core CPI: Rose by 3.3% YoY (May: 3.4%, Consensus: 3.4%), with a modest 0.1% MoM increase—the slowest since January 2021. ✍ Gasoline Prices: Fell by 3.8%. ✍ Used Vehicles: Prices dropped by 1.5%. ✍ Shelter Costs: Increased by only 0.2% in June, after having sustained inflation for many months. 👀 What to expect? 👍 Federal Reserve Actions: Powell will base actions on inflation and employment data. Although inflation remains above the long-term target of 2%, the high-rate environment has also stunted economic growth. Therefore, the pressure to do the rate cut is getting bigger! 👍 Potential Rate Cuts: September could mark the beginning of rate cuts. The Implied Overnight Rate has shifted to 3x (previously 1x), indicating market expectations. (picture attached) 👍 Impact on Markets: Falling interest rates are typically “dollar negative,” enhancing the appeal of Emerging Markets (EM) as their currencies strengthen. On the other side, prepare for potential increases in travel costs 😆 Let's gear up for equity season and stay wise & smart! Source : Bloomberg, CNBC, CNN #inflation #economy #thefederalreserve #stockmarket #bondmarket

Clients are always asking me where rates are going and for 30 years they generally went lower until March 2022 when the Federal Reserve Board started to raise the Fed Funds Rate to tame inflation which currently sits at 5.33%. SOFR is 5.30% and Prime is 8.50%…For the last 23 months clients have been telling me after the Fed raises rates and gets inflation under control, rates are going to come down…they must have been listing to some TV pundit on Bloomberg March 2022 as this is the constant theme for 23 months…while I agree I’ve never thought it would be quick, as the Fed has one lever to pull and it’s be 23 months and there is still another 3-6 months before we see dramatic movement as the Fed appears poised to wait until they have true conviction inflation is under control. With that said, over the last six months the 10Yr T-Bill has traded between 3.80-5.00% and current hover around 4.32%. Pensford and Chatham Financial are two good sources of interest rate data and the attached article from Pensford discusses the historical spread between the Fed Funds Rate and 10Yr T-Bill being 125bps…read article and pay attention to the section header on Lower But Slower (tm)#interestrates #financingsolutions #marcusmillichap #mmcc #commercialrealestate #multifamily #realestatetrends #realestatefinance

In the past few weeks, the bond #market has been doing its best John Maynard Keynes impression, quoting, “When the facts change, I change my mind.” One fact that changed was the October CPI report. Though just a slight beat to expectations, the report showed continued progress that pandemic #inflation is moderating, including even the stickiest components like owners-equivalent rent. Yields fell sharply in response to the cooler inflation print, with further downward pressure coming from some slightly cooler economic data. Read this week's #WeeklyEdge by Ben Emons, MBA, MsF here: https://lnkd.in/e5FG2ErP #NewEdgeWealth

See how the #SP500 reacted to softening CPI inflation data as well as data on consumer and business sentiment. Also, get a look ahead at upcoming economic and earnings releases.

See how the #SP500 reacted to softening CPI inflation data as well as data on consumer and business sentiment. Also, get a look ahead at upcoming economic and earnings releases.

See how the #SP500 reacted to softening CPI inflation data as well as data on consumer and business sentiment. Also, get a look ahead at upcoming economic and earnings releases.

See how the #SP500 reacted to softening CPI inflation data as well as data on consumer and business sentiment. Also, get a look ahead at upcoming economic and earnings releases.

See how the #SP500 reacted to softening CPI inflation data as well as data on consumer and business sentiment. Also, get a look ahead at upcoming economic and earnings releases.

See how the #SP500 reacted to softening CPI inflation data as well as data on consumer and business sentiment. Also, get a look ahead at upcoming economic and earnings releases.