Economic Updates

Predictably, the topic of negative interest rates has received quite a bit of media coverage ever since, so you may be wondering what it means and whether the Fed will take the President’s advice. On its face, the idea of interest rates below 0% might seem absurd – the bank pays customers to take a loan?  Customers pay the bank to hold their money? Is that even possible? Theoretically, the answer is yes. 

In this month’s recap: The Fed cuts interest rates, the price of oil spikes, and trade negotiations between the U.S. and China are rescheduled.

 

September brought an economic event that was widely expected: a quarter-point cut in short-term interest rates by the Federal Reserve. It also brought an attack on two of the world’s largest oil fields that threatened to dent global crude output. A resumption of U.S.-China trade talks was scheduled for October, and White House officials decided to delay some planned tariff increases. Clear signals of an economic slowdown emerged from both the eurozone and China; some of the key U.S. economic indicators looked much better by comparison. While all these events transpired, the S&P 500 gained 1.72% for the month.¹ 

In this month’s recap: stocks descend as traders respond to the devaluation of the Chinese yuan as well as new developments in the ongoing U.S.-China trade talks; the price of gold rises, and bond yields fall.

In this month’s recap: the Federal Reserve eases, stocks reach historic peaks, and face-to-face U.S.-China trade talks formally resume.

THE MONTH IN BRIEF

In this month’s recap: Stocks, gold, and oil all surge, a door opens for U.S.-China trade talks to resume, and the Federal Reserve suddenly sounds dovish.

THE MONTH IN BRIEF

You could say June was a month of highs. The S&P 500 hit another record peak, oil prices reached year-to-date highs, and gold became more valuable than it had been in six years. (There was also a notable low during the month: the yield of the 10-year Treasury fell below 2%.) Also, a door opened to further trade talks with China, and the latest monetary policy statement from the Federal Reserve hinted at the possibility of easing. For most investors, there was much to appreciate.¹  

In this month’s recap: major stock benchmarks descend as new developments in the U.S.-China tariff dispute lead to a broad risk-off in equities; consumer confidence surges, while the housing market cools.

In this month’s recap: the S&P 500 returns to record territory, key economic indicators show strength, oil continues its ascent, and existing home sales decline.