June 12, 2023

Weekly Market Update

By Michael McKeown, CFA, CPA - Chief Investment Officer

Weekly Market Update

Chart of the Week

In May, headline inflation data fell from last year’s 9% to 4.1%. Prices fell at a faster rate than they rose in the 12 months leading to the June 2022 peak. This follows a similar pattern from the last five times that inflation peaked at over 6% in the US. Each time the peak rate of inflation ended near where it began two years prior.

The pattern indicates the Consumer Price Index is continuing to fall. The lower pace of inflation gives the Fed some much-needed breathing space for its meeting this week. However, core inflation remains stubbornly high. The July Fed meeting is still “live” as the committee members debate another hike. The good news is that the healing supply chain and rate hikes are having the intended impact of lowering inflation.

U.S. Treasuries - Yield Curve is Inverted

What We’re Reading

Paying Attention (to what matters) – Morgan Housel
Words of Wisdom from the late Sam Zell – Novel Investor
House unanimously passes bills to expand accredited investor pool – Investment News
Bill to Fix Big Secure 2.0 Drafting Errors Is Coming – Think Advisor
How Plan Sponsors Can Shift Focus to Decumulation – Plan Sponsor

Podcast of the Week

Why Fertility Rates Are Plunging—in the U.S., South Korea, and Everywhere Else – Plain English

Last Week

Inventories fell less than expected, while jobless claims ticked higher. The strong jobs report for May seems to conflict with the weekly data. Anecdotally, the jobs market remains tight based on our conversations, and the surveys continue to confirm the trend.

The Past Week

The Week Ahead

The Fed Chairman’s press conference on Wednesday will be watched for any hints about the future likelihood of an extended pause or just a skip of hiking at this week’s meeting. Retail sales, industrial production, and consumer sentiment are on the radar for key data releases.

The Week Ahead

Thank you for reading.

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