Weekly Economic Update – March 8, 2010
This weeks economic news:
Monday
- No relevant economic data scheduled for release.
Tuesday
- Demand for the 10-year Note auction was much better than expected, though the rates that were bid for were higher than thought also. Overall, the sale can be considered pretty good, especially with the lackluster interest in recent auctions.
Thursday
- January’s Goods and Services Trade Balance reported a $37.3 billion trade deficit in January. This was much lower than expected however, the data is not important enough to directly affect bonds or mortgage rates.
- The Labor Department reported that 462,000 new claims for unemployment benefits were filed last week. This was a decline from the previous week, but slightly higher than the 460,000 that was forecasted.
Friday
- February’s Retail Sales data from the Commerce Department showed a 0.3% increase in sales when a small decline was expected. Even if more volatile auto sales are excluded, sales exceeded forecasts by a wide margin. This led to the negative open in bonds and this morning’s increase in mortgage rates because the data indicates consumers were spending more than thought. That raises expectations of economic growth that usually makes bonds and long-term securities less appealing to investors.
- The University of Michigan who said their Index of Consumer Sentiment stood at 72.5 this month. This was lower than forecasts and means surveyed consumers were less optimistic about their own financial situations than many had thought. This is the good news of the morning because waning confidence usually means consumers are less likely to make a large purchase in the near future.
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