The most inverted US yield curve since the 80s
The 3-Month Treasury bill yield of 4.97% is now 1.42% higher than the 10-Year Treasury bond yield (3.55%). With data going back to 1962, only March 7, 1980 (recession: Feb-Jul 1980) had a more inverted yield curve than today. Source: Charlie Bilello
Eurozone headline inflation cools down: core inflation hits all-time-high
Eurozone headline inflation cools significantly to 6.9% YoY in March, down from 8.5% in February and lowest level since February 2022, AND lower than estimated 7.1% Bloomberg poll. But core inflation, which excludes volatile items, quickened to 5.7%, a fresh All-Time-High, showing inflation pressure remains high. Source: HolgerZ, Bloomberg
Germany's headline inflation eased significantly but less than expected
Germany's headline inflation eased significantly but less than expected AND underlying price pressure keeps rising. CPI dropped from 8.7% in Feb to 7.4% in March overshooting expectations of 7.3%. Core CPI rose from 5.7% to 5.9%, according to Commerzbank calculations. Source: HolgerZ
The US Treasury cash balance just reached another recent low
The latest government report is out, and the US Treasury cash balance just reached another recent low. Only $187 billion is left. Let's keep in mind that February's deficit alone cost $262 billion. Ultimately, this could mean that we are about to see another flood of Treasury issuances if/when the debt ceiling issue gets resolved. Will the natural supply/demand mismatch caused by this dynamic pressure yields higher and create further problems in the fixed-income market= Source: Boomberg, Tavi Costa, Crescat Capital
St. Louis Fed Financial Stress Index rises to 1.575 - a level seen only four times during the last 30 years
In every case VIX hit at least 45. During the last two spikes, it hit 80. Source: Bloomberg, Oktay Kavrak, CFA
German Ifo business confidence shows economy's resilience against the recent banking crisis
German Ifo business confidence shows economy's resilience against the recent banking crisis, w/all 3 Ifo components rising in March. Data highlight that industry is holding up as the threat of an energy crunch recedes. BUT all 3 indexes remained a bit below long-term avg of 96.6. Source: HolgerZ, Bloomberg
One of the best bank deals of our time?
First Citizens's shares jumped 54% after NCarolina lender took over SVB's $56.5bn in deposits as well as $72bn in loans at discount of $16.5bn. FDIC will help finance deal w/$35bn loan & $70bn credit line to help cover pot depo flight. Source: DJ, HolgerZ, Bloomberg
Used car prices increased again for the 5th month in a row
Prices continue to firm up at historical levels, despite being down about 2% on a year-over-year basis. Inflationary forces remain stubbornly high due to structural macro drivers. The Fed just erased 5 months of QT in two weeks. Will it add fuel to the inflation fire? Source: Tavi Costa, Bloomberg, Crescat Capital
