As the world confronts the real possibility of another prolonged global conflict after the horrific attack on Israel over the weekend, the humanitarian tragedy has already been profound. Risks that the conflict may broaden across the Middle East are certain to intensify political divides across the globe. Financial markets, already feeling the pinch from rapidly rising interest rates, will likely remain volatile until the full effects of this past weekend’s events are understood.
After Friday’s employment report posted job gains of 336,000 — the highest number since January — Treasury yields across the curve moved to the highest levels since 2007.1 Federal Reserve policymakers will look for better news in this week’s inflation data; the Producer Price Index (PPI) will be released Wednesday, followed by the Consumer Price Index (CPI) Thursday.2 Thursday’s $20 billion 30-year Treasury bond auction will provide another test for the bond market after weak demand at the August long-bond auction sparked a sharp selloff.
1The Washington Post – Economy adds 336,000 jobs in September, in a stunning gain; 10/6/23
2MarketWatch – U.S. Economic Calendar; as of 10/9/23
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