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Fixed Income Weekly Market Commentary

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This commentary, published by Janney Fixed Income Strategy & Research, covers key occurrences in economics, interest rates, agencies and corporates, and municipal bonds from the preceding week.

FI-Weekly-Header.JPGMay 18, 2015: It’s the last week before the unofficial kickoff of summer and rates are near the high side of their 2015 year to date range. Click here to read more.

IN THIS ISSUE OF FIXED INCOME WEEKLY:   

  • GDP trackers such as the Atlanta Fed’s GDPNow estimate provide valuable information on short term economic conditions, though tracers by definition have limits.

  • It’s been fifteen months since we put forth our first argument on an “equilibrium” fed funds rate below 3% driving long term yields lower; we revisit that thesis in light of the recent long end selling.

  • A stronger dollar—the recent counter-trend selloff aside—continues to impair the profitability of US-based corporations that earn significant revenue in overseas markets.

  • Chicago was downgraded last week, including a cut to below investment grade by Moody’s, and while comparisons with Detroit are tempting, Chicago’s economic vibrancy negates the worst of the links.