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MARKET UPDATE

Fed Holds Rates Steady as Inflation Pressure Persists

09.22.2023

This morning equity markets edged up and Treasury yields are lower with the 10-year yield trading near 4.45%.  Last week, there was new CPI data and it was in line with consensus expectations, continuing to trend far below the 40-year highs of summer 2022.  Nonetheless, the current level remains above the Fed's 2% target.  On the other hand, the latest JOLTs number came in at 8.8 million, notably weaker than consensus expectations and last months number. While this is only one cooler jobs number, the data point and trend are increasing expectations for the labor market to weaken in the near future.  Since early 2022, the Fed has rapidly tightened monetary policy, with the cumulative amount of hikes now at 5.25%.  At this week's FOMC meeting, the Fed held rates steady and reiterated its commitment to bring inflation down to their target of 2%.  The message remains that there may yet be additional hikes ahead, and the FOMC's next meeting is at the end of October.  Concern persists that inflation is elevated, but fears about a near term recession have eased.  The question of whether the Fed can tame inflation without creating other economic issues, "a soft landing", remains in the front of investors minds.

- CMS Staff

TREASURY YIELDS

Term

3 Month

6 Month

2 Year

5 Year

10 Year

30 Year

Current

5.47%

5.52%

5.10%

4.55%

4.43%

4.52%

Last Month

5.43%

5.46%

5.04%

4.48%

4.32%

4.39%

BENCHMARKS

PRIME:

DJIA:

Crude Oil (WTI):

YEN:

Gold:

1 Year CMT:

1 Month T-Bill:

Fed Funds Effective:
Next FOMC Meeting:

8.50%

34,128.24

$89.89

148.2900

$1,925.31

5.44%

5.388%

5.33%

Oct/Nov 31-1, 2023

Source: Bloomberg

ECONOMIC CALENDAR
Week of 9
/18/2023

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