Consumer Economy
ISM Manufacturing Index: 49.0, expected 49.6, neutral=50
ISM Services Index: 50.8, expected 53, neutral=50
Nonfarm Payrolls (PAYEMS): 159.4M +228K (+0.14%)
Civilian Employment 16+ (CE16OV); 163.5M +201K (+0.12%)
This week, we saw a slight contraction in manufacturing, flat in services, and a modest expansion for payrolls (both household and establishment). The (recession-detector) Part-time work/Slack work indicators just rose slightly – not enough to matter.
Native (LNU02073413) 131.2M +329K (+0.25%)
Foreign (LNU02073395) 32.2M +538K (+1.70%)
Foreign-born are back to outperforming in employment. Using this metric, self-deportations do not appear to be happening – at least not at scale.
Disability
CNP (LNU00074597) 34.4M +134K +0.39%
CLF (LNU01074597) 8.2M -91K -1.09%
EMP (LNU02074597) 7.6 -22K -0.29%
NILF (LNU05074597) 26.2M +224K +0.86%
Population disability numbers continue to increase, remaining above the MA12, which indicates a rough uptrend. That said, labor force (CLF) disability is declining, and not-in-labor-force (NILF) disability is increasing. “I’m not gonna work anymore with this condition” is what 224k people seem to be saying. The equation is: CNP (population) = CLF (working or looking) + NILF (not looking).
Credit & Rates
Total Bank Credit (TOTBKCR): 18.155T +26.4B (+0.15% w/w)
Fed Balance Sheet (WALCL): 6.723T -16.8B (-0.25% w/w)
30-Year Mortgage Rate (MORTGAGE30US): 6.64% -1 bp
10-Year Treasury (DGS10): 3.93% -30 bp
20+ Treasury Fund (TLT): +3.01% w/w
Another nice increase in bank credit (7.8% annualized), but the big news: there was a massive drop in rates this week – money is flowing into the longer end of the yield curve. That’s pretty typical of a flight to safety/risk-off move.
That 10-year yield fell a YUGE 34 basis points – quite the drop – and DGS10 is in a strong downtrend. Dropping 10-year yields = TLT owners make money.
CME Fedwatch Tool projects a 33% chance of one cut at the May 7th meeting. And yet…
Fed’s Powell says larger-than-expected tariffs likely to boost inflation, slow growth [Apr 4]
“While tariffs are highly likely to generate at least a temporary rise in inflation, it is also possible that the effects could be more persistent,” Powell said.
by richcabot 
