New filings for jobless benefits inched up to 198,000 last week from 191,000 earlier, staying below the pre-pandemic level, while fourth-quarter gross domestic product was revised down slightly from a 2.7% increase to 2.6%. … READ MORE >
Federal Reserve
RSM US Manufacturing Outlook Index: Slowdown continues
According to the RSM US Manufacturing Outlook Index based on those surveys, manufacturing activity remains at 1.8 standard deviations below normal. … READ MORE >
The great deposit migration, moral hazard and a fragmented banking system
The recent financial shock has exposed the underlying problem in the banking sector: A flawed regulatory framework treats small and medium-size institutions unequally compared to their largest competitors. … READ MORE >
The impact of expectations for Fed policy on the money and bond markets
Prices in the money market now suggest increased levels of risk being priced into short-term lending and the tightening of overall financial conditions that was missing until the recent banking turmoil. … READ MORE >
Initial jobless claims drop further
Initial claims for unemployment benefits fell by 1,000 to 191,000 last week, remaining below the pre-pandemic average and below expectations of a slight increase to 197,000. … READ MORE >
Catch-25: Fed hikes rates amid financial stability risk
The Federal Reserve finds itself as it lifted its policy rate by 25 basis points on Wednesday amid a quickly evolving global banking crisis. … READ MORE >
Financial shock sending Fed proxy rate into restrictive terrain
Should the crisis deteriorate further, with more bank seizures and further problems inside systemically financially important institutions, then the degree of financial shock is equivalent to 150 basis points of tightening. … READ MORE >
Coordinated central bank action follows the Credit Suisse-UBS merger
Global central banks acted over the weekend to stem dollar funding pressures in financial markets as investors digested the forced merger of Credit Suisse and UBS. … READ MORE >
Consumer sentiment fell in March, before the financial turmoil
Consumer sentiment for March dropped to 63.4 from 67 as consumers’ confidence in the current economic conditions and their expectations both worsened on the month, though the survey results did not reflect the recent turmoil in financial markets … READ MORE >
The great deposit migration and emergency borrowing at the Fed discount window
In the past week alone, the Federal Reserve’s loans outstanding to the financial system have ballooned to about $318 billion, up from $15 billion a week ago. … READ MORE >