Financial markets faced volatility this week as the S&P 500 declined over 1%, driven by weakness in the technology sector. Treasury Secretary Scott Bessent’s intervention in the long bond market failed to lower yields, instead increasing term premiums and sparking market skepticism amid rising national debt. While import prices showed progress, core figures remain elevated, signaling persistent inflationary pressures. Industrial production remains modest, though AI-related industries provide a notable boost. August PMI data reveals a robust services sector and a surprising uptick in employment, suggesting potential third-quarter growth acceleration. Despite FOMC minutes indicating that some participants consider further tightening necessary, market pricing reflects a cautious outlook on future rate hikes. Investors remain focused on upcoming PCE data and the Jackson Hole conference for further clarity on the economic trajectory.
Sign in to continue reading, translating and more.
Open full episode in Podwise