Good Thursday AM from your Hometown Lender,

A little bit of data today.

The Bank of England keeping rates unchanged, Bank of Switzerland cutting by .25% (first central bank in an advanced economy to cut), Unemployment claims coming in slightly lower than expected but still over 200k, and Philly Manufacturing survey coming in a little hot. Equities are doing well with the Dow about to break 40k, bonds are hanging tough. The challenge for bonds is they are hitting resistance and currently don’t have the momentum to push through. The likeliest scenario is that if bonds don’t get a boost, they are going to fall back into support which is roughly 40bps from where we are now. There is no economic data release on the books for tomorrow. If you floated through the Fed meeting and are closing in the next few weeks, today may be a good day to lock.

Speaking of yesterday’s Fed meeting…

As expected, the Federal Reserve held interest rates steady. Officials still expect three rate cuts in 2024, which was a concern. It turns out that firmer-than-expected inflation in the first two months of the year hasn’t derailed the central bank’s plans. Stocks rallied to fresh records, in part because traders think the odds of a rate cut by June have gone up. According to CME Group’s FedWatch tool, those odds are north of 75% as of today, up about 20 percentage points from before the announcements. But a stronger-than-expected growth environment has raised policymakers’ outlook for longer-term rates: Fed officials now forecast fewer rate cuts in 2025 and 2026. And the longer-term “neutral” rate needed to keep the economy at full strength with steady inflation is now expected to be 2.6%, up slightly from 2.5% in December. That’s too far out to predict. Markets know that and are taking it with a grains of salt.

Please remain safe and healthy, make today great!