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From the Desk - Economic Commentary

Brandon Casey - 5/13/2021

U.S. stocks are on the rise Thursday morning and are on track to end a three-day losing streak. The stretch to start the week has been the worst three-day stretch for equities since October. Recent inflation data has investors concerned that the Federal Reserve may change monetary policy, though policymakers have maintained that current pricing pressure will be transitory and the Fed is not ready to alter easy policy.

Looking at data today, initial jobless claims fell more than expected to 473,000 last week, the lowest level of the pandemic. Continuing claims edged lower to 3.66 million. Elsewhere, the Producer Price Index increased 0.6% in April, doubling expectations, and prices increased 6.2% over the past year, the largest index since tracking began in 2010. Core prices, which strip out volatile measures such as food, energy and trade services, increased 0.7% for the month and 4.6% over the last year, the highest since 2014, which is when tracking for core data began.

U.S. Treasury yields are down this morning, with the 2-year Treasury yield down 0.6 basis points to 0.16%, the 5-year Treasury yield down 2.7 basis points to 0.84% and the 10-year Treasury yield down 3.0 basis points to 1.67%. Long-term advance rates are slightly higher this morning.

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