Well the first read on GDP for the 2nd quarter came in much weaker than expected at a -.9%. This follows a contraction of 1.6% in the 1st quarter. While the ‘talking heads’ debate whether it is or isn’t a recession my only question is whether it is short and mild or long and deep?
So the next Fed meeting isn’t until September so we will see plenty of data before that meeting, but each piece of data that is released will determine the Fed’s direction—just my guess is that 75 basis point increases are in the rear view mirror.
The 10 year treasury is now at 2.73%–off 3-4 basis points—is it headed lower? Guess we just have to wait and see–so many moving parts in the global economy (energy and employment being key).