Overview: Thu, May 26

Time Indicator/Event Comment
06:10Bullard (FOMC voter)On U.S. economy and monetary policy
08:30Durable goodsSmall increase likely in April
08:30Jobless claimsShould hold close to recent average
10:00Pending home salesThird straight increase in April?
11:00Kansas City Fed indexUnchanged at mildly negative level in May
11:003- and 6-month bill announcementNo changes expected
11:004-week bill announcementAnnouncement moved up due to holiday
12:00Powell (FOMC voter)On the economy
13:007-yr note auction4th consecutive $28 billion offering

US Economy

  • Economic Indicator Preview for Thursday, May 26, 2016

    Today’s calendar starts off with the weekly jobless claims report and the advance durable goods report, both at 8:30.  We expect both initial and continuing claims to hold roughly steady in their respective reporting weeks, and we think overall durable goods orders may eke out a small increase in April.  We look for a third consecutive increase in pending home sales in the April report at 10:00, while the Kanas City Fed factory index for May, at 11:00, may hold steady at last month’s mildly negative level.

Federal Reserve and the Overnight Market

Treasury Finance

  • Treasury Finance Agenda for Thursday, May 26, 2016

    Today’s announcements: 4-week and 3- & 6-month bills
    Today’s auction: 7-year notes

    Note: the Treasury’s 4-week bill auction announcement has been moved up to this morning due to the Memorial Day holiday.

This Week's MMO

  • MMO for May 23, 2016

    Last week’s FOMC minutes stopped short of signaling a rate hike in June, but leaned harder in that direction than we anticipated.  Upcoming public appearances by Fed officials, especially Chair Yellen, will be critical to the outlook. 

    Separately, the Alternative Reference Rate Committee published an interim report on Friday.  The committee has tentatively narrowed the list of next-generation reference rate candidates to two options: the Fed’s new Overnight Bank Funding Rate and some to-be-determined Treasury GC repo rate alternative.  The report also lays out a tentative strategy for building liquidity in the early phases of adopting the new benchmark.  The report urges market participants to comment on the proposals by July 15.

Federal Reserve Commentary

MMO Analysis