Interest Rate Roundup

Monday, April 30, 2007

Monday morning rundown...

It's hard to keep up with the economic calendar on days like today. But I'll do my best to recap what we've just learned ...

* Personal income rose 0.7% in March, while spending gained just 0.3%. Income was a bit hotter than expected, spending a bit weaker. An inflationary indicator buried in the report called the core PCE was flat, vs. expectations for a 0.1% gain.

* The Chicago Purchasing Manager's Index took a header in April -- falling to 52.9 from 61.7 a month earlier. However, the inflation measure embedded in that report -- the "prices paid" subindex -- surged to 64.9 from 59.1 in March. That's the highest reading since August.

* It continues to be a tale of two construction markets -- with residential building weak and commercial building activity hanging in there. In March, private residential construction spending dropped another 1%, while private non-residential construction spending gained 2.4%. A few notable standout sectors: Hotel spending was up a hefty 13.2%, while spending on amusement facilities jumped 9.4%.

Treasuries are getting frisky on the weak growth figures, even though the inflation indicators were a mixed bag (one lower than expected, one higher than expected). The U.S. Long Bond was recently up 21/32, while 10-year Treasury yields were down 5 basis points to 4.64%.


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