U.S. Treasury Yield Curve
The U.S. Treasury yield curve is inverted from 30 days to 3 years, reflecting the fear of an economic slowdown due to the spread of the Covid-19 coronavirus, which has dominated the news. There is also a growing expectation that the Federal Reserve will cut rates in order to calm the markets and support GDP growth and liquidity.
ISM Manufacturing Index
The January reading on manufacturing was higher than expected and showed an upturn in the sector. Due to the lagged nature of this survey data, however, it reflects little or no impact from supply chain disruptions in China and slowing demand due to the effects of the Covid-19 coronavirus. The impact of these issues on this manufacturing data should be evident in the coming months.
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