Market Updates.

• We’ve been encouraged by recent economic forecasts and numbers that indicate a softer overall inflationary impact.
• The unemployment rate fell to 3.7%, and U.S. nonfarm payrolls rose to 199,000 in November, a slight increase from the payroll gain of 150,000 in October.
• The November Consumer Price Index (CPI) increased by 0.1% over last month and is up 3.1% from a year ago. Wholesale prices remained unchanged in November, which is also an encouraging inflation indicator.
• As we approach 2024, there is some optimism in the housing market — even though housing prices are still high and supply is difficult, the average 30-year fixed mortgage rate declined to 7.07%, the lowest rate since July. Over the past week, mortgage applications increased by 7.4% and refinance applications increased by 19%.
• In the December meeting, the Federal Reserve opted not to raise interest rates, remaining within the 5.25%–5.5% target range. Projections released by the Fed indicate an expectation of four rate cuts in 2024, aiming for the goal of a 4.6% rate by the end of 2024.
• The Fed also shared an encouraging core personal consumption expenditures price index (core PCE) forecast indicating a decline of 2.4% in 2024 and 2.2% by 2025 to reach their 2% target in 2026. Previous forecasts indicated a decrease of 2.6% in 2024 and 2.3% in 2025.
• We are wishing you a very Happy Holiday season and a prosperous New Year!

Sources

• U.S. payrolls rose 199,000 in November, unemployment rate falls to 3.7%
• S. Bureau of Labor Statistics Economic News Release Consumer Price Index Summary
• Fed lowers inflation forecast for 2024, seeing core PCE falling to 2.4%
• Fed holds rates steady, indicates three cuts coming in 2024
• Wholesale prices held flat in November, providing another encouraging inflation signal
• Mortgage Applications Increase in Latest MBA Weekly Survey
• Mortgage refinance demand jumps 19% after rates hit lowest level since July

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Securities and Advisory Services offered through Harbour Investments, Inc. Member SIPC & FINRA.

Market Updates.

• While we have observed some unexpected fluctuations in the economy recently, they don’t appear to be extreme, and the economy remains resilient and strong.
• The Bureau of Labor Statistics October report showed a cool down as U.S. nonfarm payrolls only increased by 150,000, less than expected, while the unemployment rate rose to 3.9%.
• The October Consumer Price Index, which measures consumer price changes over time (excluding food and energy) was lower than anticipated with a two-year low of 4%.
• This month, the U.S. 10-year Treasury yield fell by almost 9 basis points, and the 2-year Treasury yield has fallen nearly 10 basis points.
• We saw an 0.8% decrease in import prices, along with a 0.5% decline for the Producer Price Index in October, the biggest drop since April 2020.
• Although the Federal Reserve opted not to raise interest rates in October, and it is encouraging to see the pace of inflation begin to slow, the Fed is still committed to enforcing a restrictive monetary policy through rate increases to achieve a decreased 2% inflation rate.
• Despite decreases in the jobs market, the potential slowing of inflation and interest rate hikes encourages us. No matter what, we won’t leave your financials up to chance or wait to see what the market does tomorrow. The Triangle Financial team always takes a long-game perspective, so you can rest assured we keep your future security in focus.

Sources

• CNBC Daily Open: Markets enjoyed early frost in October’s jobs report
• Treasury yields fall as investors weigh interest rate outlook
• Powell says Fed is ‘not confident’ it has done enough to bring inflation down

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Securities and Advisory Services offered through Harbour Investments, Inc. Member SIPC & FINRA.

Market Updates.

Overall, the U.S. economy continues to be resilient.

• Recent market fluctuation may be linked to the September jobs report, which was unexpectedly positive. Payrolls and hourly earnings increased, and the unemployment rate is slightly lower than expected. Job growth continues in the leisure and hospitality industries.
• Although the Federal Reserve didn’t raise interest rates in September, we still anticipate additional rate increases before year end.
• Consumers are selling out of long-term treasury bonds for liquidity, which makes sense with the 10-year treasury yield climbing to 4.88%. This is close to the level it was prior to the 2008 financial crisis.
• Economists continue to push out the timeline for when a recession could occur. That, combined with the fact that the only thing that’s been consistent with the market is that it’s unpredictable, means we can’t forecast for certain how the market will perform tomorrow.
• At Triangle Financial, we focus on a long-game perspective. Instead of making decisions based on what we think may happen tomorrow, we plan according to what we know right now. That way, you can rest assured that we are always keeping our eye on your future financial security.

Sources

• Payrolls soared by 336,000 in September, defying expectations for a hiring slowdown
• The Bureau of Labor Statistics: The Employment Situation — September 2023
• Why borrowing costs for nearly everything are surging, and what it means for you
• Fed declines to hike, but points to rates staying higher for longer

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Securities and Advisory Services offered through Harbour Investments, Inc. Member SIPC & FINRA.