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America is borrowing like it's in a recession. It isn't

The federal deficit is approaching six per cent of GDP while unemployment sits near a historic low of 3.5 per cent.

The Treasury needs more money, and companies will feel it

On 2 August the US Treasury raised its quarterly refunding to $103 billion, the first increase in coupon issuance since 2021.

America loses its AAA again. Does it matter?

Fitch Ratings cut the United States from AAA to AA+ on 1 August, an unwelcome reminder of the fiscal arithmetic.

Is the economy really this strong?

Second-quarter GDP grew at an annualised 2.4 per cent, confounding the many who forecast recession and suggesting consumers are still spending freely.

One more hike, then what?

Futures markets put the odds of a quarter-point rise at the July FOMC meeting at ninety-eight per cent, so the decision itself is settled.

Why banks are selling their best loans

Banks are selling high-quality corporate loans to private credit managers and other institutional buyers, when they might be growing their balance sheets or putting spare cash into yielding assets.

Is Japan about to loosen its grip on bonds?

The yen sits near 139 to the dollar and headline inflation is comfortably above target, and speculation is growing that Kazuo Ueda will loosen or scrap the Bank of Japan's yield curve control (YCC).

Inflation hits 3%. The easy part is over

Headline US consumer price inflation fell to 3.0 per cent in June, and plenty of commentators declared the war won.

Inflation is falling without a recession. Can it last?

Consumer price inflation is slowing while the US economy still adds more than 200,000 jobs a month, and the optimists have found their gospel.

Prime Day: What Amazon's discounts say about inflation

Shoppers spent an estimated $12.7 billion over Amazon's two-day Prime Day, an event that has become a rough gauge of how American consumers are holding up and what retailers can charge.

Banks passed the stress test. Now comes the real test

All twenty-three banks in the Federal Reserve's annual stress test passed in late June, showing on paper that they could survive a severe fall in commercial property prices and a global recession.

Independence Day: Washington is paying factories to come home

Through the CHIPS and Science Act and the Inflation Reduction Act, Washington is handing out tens of billions of dollars in grants, loans and tax credits to bring factories home.

Why British homeowners feel rate rises faster than anyone

Two-year gilt yields are climbing toward 5.5 per cent, their highest since 2008, and British homeowners are feeling it faster than borrowers almost anywhere else in the rich world.

The stubborn inflation the Fed can't shake

Core PCE inflation ran at 4.6 per cent year-on-year in May, and Federal Reserve officials can think of little else.

China's lending engine sputters

The People's Bank of China cut its one-year loan prime rate by ten basis points, to 3.55 per cent, and very little happened.

Why company defaults are creeping up

Company defaults are rising, but by an unfamiliar route. In past downturns bankruptcies followed a sudden fall in sales, or a breach of covenants that strict bank lenders chose to enforce.

Britain's mortgage crunch returns

Two-year gilt yields have risen above five per cent because UK core inflation will not come down, and mortgage rates have followed them to levels last seen in the global financial crisis.

What the Fed's forecasts really say

The Federal Reserve held its benchmark rate in June but raised the median projection for where rates will peak to 5.6 per cent.

The Fed wants to pause without looking soft

Headline inflation has slowed to 4.0 per cent year-on-year, which gives the Federal Reserve a reasonable case for pausing its rate increases at the June meeting.

A bull market built on seven stocks

The S&P 500 has risen twenty per cent from its October low, which by the market's arbitrary convention makes this a bull market.

The Treasury refills its account, and markets pay

The US Treasury is rebuilding its operating balance towards $600 billion, after running the Treasury General Account down to almost nothing to avoid breaching the debt ceiling.

The jobs report that disagrees with itself, again

Non-farm payrolls rose by 339,000 in May, well above a consensus that had expected a gentle slowdown.

The debt deal that changes almost nothing

The 27 May agreement suspends the federal debt ceiling through 2025, and its authors have hailed it as a triumph of bipartisan restraint.

Memorial Day: The debt deal is done. Now comes the bill

Negotiators agreed on 27 May to suspend the debt ceiling, and Washington's political drama ended in its usual anticlimax.

Nvidia's forecast stuns Wall Street

Nvidia told investors on 24 May to expect second-quarter revenue of $11.0 billion, 53 per cent above the consensus forecast of $7.15 billion.

Get ready for a flood of Treasury bills

Negotiators in Washington are edging towards a last-minute deal that would suspend the debt ceiling until 2025, and money markets are preparing for the hangover.

Nobody can agree how much savings Americans have left

The Federal Reserve Bank of San Francisco reckons that about $500 billion of the $2.1 trillion in excess pandemic savings is left, and that it will be spent by late summer.

Why core inflation stopped falling

Headline consumer prices rose 4.9 per cent in the year to April, the first reading below 5 per cent in two years.

Office towers face a $1.5trn refinancing problem

About $1.5 trillion of commercial real estate debt matures before the end of 2025, according to Morgan Stanley, and office loans are the hardest part of it to refinance.

When does America run out of money?

Janet Yellen told congressional leaders that the federal government could run out of cash "as early as 1 June", turning the debt-ceiling standoff into an immediate problem for the plumbing of the financial system.

Why regional banks lost a third of their value

The KBW Regional Banking Index (KRE) has fallen by more than 35 per cent since Silicon Valley Bank failed on 8 March.

Is this the Fed's last hike?

The Federal Deposit Insurance Corporation seized First Republic Bank in the early hours of 1 May and sold most of its assets and deposits to JPMorgan Chase straight away.

First Republic's final quarter: $100bn walks out the door

First Republic Bank lost $102 billion of deposits in the first quarter, according to the earnings report it finally published on 24 April.

Markets start pricing an American default

The spread on one-year US sovereign credit default swaps (CDS) rose past 100 basis points in late April.

Tighter loans today, more defaults tomorrow

A net 45 per cent of American banks were tightening credit in the Federal Reserve's January Senior Loan Officer Opinion Survey (SLOOS), and that was before the March banking panic.

Tax Day: What April's tax cheques say about the debt ceiling

Millions of Americans filed their federal income tax returns by 18 April, and money market desks on Wall Street spent the day doing sums of their own.

China is spending again. Its property market isn't

China's economy grew at a respectable 4.5 per cent annual pace in the first quarter, lifted by a sharp rebound in retail spending, restaurants and domestic travel after the end of zero-Covid.

The real cost of the banking crisis: customers want interest

JPMorgan Chase opened the first-quarter bank earnings season with record net revenue of $38.3 billion and a 52 per cent jump in net income.

The Treasury bills nobody wants to hold

Treasury bills maturing in April and May yield about 4.0 per cent. Bills maturing in early June, right in the window when the government is expected to hit its "X-date" and run out of cash, yield well above 5.5 per cent.

Watching deposits leave in real time

March payrolls rose by a healthy 236,000, but the Federal Reserve's weekly H.8 release showed deposits still pouring out of small and mid-sized banks.

OPEC just made the Fed's job harder

OPEC+ surprised oil markets on Sunday, 2 April, by announcing a production cut of 1.16 million barrels per day.

First Republic has been rescued. It hasn't been saved

Eleven of America's largest banks deposited $30 billion of uninsured cash in First Republic Bank on 16 March, in a deal put together by JPMorgan Chase and Treasury Secretary Janet Yellen.

Savers flee banks for money funds

Assets in US money market funds (MMFs) rose past $5.1 trillion in March 2023, a record, after taking in more than $300 billion in a few weeks.

Why Credit Suisse bondholders lost everything before shareholders

Are bank failures doing the Fed's job for it?

Emergency Fed lending to banks is approaching $300 billion, according to the central bank's H.4.1 release, and that has undone months of quantitative tightening in a matter of days.

The Fed's quiet bailout of banks' bad bond bets

Banks borrowed a record $152.9 billion from the Federal Reserve's discount window, according to the H.4.1 balance-sheet release published on Thursday, 16 March.

After SVB, the biggest bond rally since 1987

How a bank run happens at the speed of an app

Depositors tried to pull $42 billion out of Silicon Valley Bank (SVB) in less than ten hours on Thursday, 9 March, more than a quarter of its deposits.

Powell signals bigger hikes are back

Jerome Powell told the Senate Banking Committee that the Federal Reserve is ready to go back to rate rises of 50 basis points if the economic data stay hot.

America's banks are sitting on $620bn of hidden losses

America's commercial banks are sitting on roughly $620 billion of unrealised losses on their securities portfolios, according to recent figures from the Federal Deposit Insurance Corporation (FDIC).