Consumer Economy
- Retail Sales (RSAFS) 752.1B +12.3B (+1.66% m/m)
- UM Consumer Sentiment (UMCSENT) 49.8 -3.5
UM Consumer Sentiment hit an all-time low this month. I had to enter the data by hand since FRED hasn’t updated it just yet. It is available at econoday.
Meanwhile, retail sales shot higher – a spike is even visible on the monthly chart. Annualized, its an 19.9% increase. I’m not sure this is a BOOMING economy. Perhaps – prepping meets Iran-war-flation.
Credit & Rates
- Total Bank Credit (TOTBKCR) 19.48T +14.9B (+0.08% w/w)
- Fed Balance Sheet (WALCL) 6.71T +1.7B (+0.03% w/w)
- US 30 Year Mortgage Rate (MORTGAGE30US) 6.23% -7 bp
- 3-Month Treasury (DGS3MO) 3.68% -2 bp
- 1-Year Treasury (DGS1) 3.67% +3 bp
- 5-Year Treasury (DGS5) 3.93% +9 bp
- 10-Year Treasury (DGS10) 4.31% +5 bp
- 30-Year Treasury (DGS30) 4.91% +3 bp
- 20+ Treasury ETF (TLT.N) -0.41% w/w
Bank credit rose by just 4.2% (annualized) this week; that’s “not nearly enough.” I maintain that “monetary inflation” mostly comes from bank credit expansion – since the newly-printed bank money is handed directly to people and companies to spend. The current week: not inflationary.
The Fed didn’t do much – just $1.7 billion in money printing, or $88 billion per year, annualized.
Long rates increased; the middle of the curve had a bad week (the 5-year jumped 9 bp), while the rest of the items saw less change. Perhaps that’s a 5-year inflation projection, thanks to the (apparently endless) Iran War. Even the 3-month declined. That’s where money seems to be going right now.
CME Fedwatch Tool projects a 1% chance of one rate increase on the April 29th meeting. The meeting is next week.
Note that Trump has U-turned on rates. He now thinks rate increases are a good idea.
Currencies
The buck had a volatile week, falling Monday/Friday, and rising Tuesday-Thursday, ending the week up 0.47 [+0.48%] to 98.36. The “bullish harami” candle did rate as bullish, and the buck is now back in a daily (and monthly) uptrend.
Winners/Losers appeared to show – mostly – the oil importers fell vs the buck. India had a particularly bad week.
Winners
- GBP 1.35 [+0.0044 +0.32%]
- AUD 0.72 [+0.0010 +0.14%]
- CAD 1.37 [-0.0030 -0.22%]
Losers
- INR 94.06 [+1.4600 +1.58%]
- RMB 6.84 [+0.0190 +0.28%]
- JPY 159.37 [+0.3500 +0.22%]
- CHF 0.78
by mike-from-jersey 
