Correspondent Blog

LEI Close to Signaling Coming Recession The somewhat bullish take on the July FOMC minutes from Wednesday was reversed yesterday when a couple Fed officials reiterated the need for continued aggressive rate hiking. That has put pressure on Treasuries this morning with the 10yr note flirting with 3.0%.   St. Louis Fed President James Bullard…

Global Inflation Worries have Treasuries under Pressure While a China-led global slowdown led to higher Treasury prices on Monday, today it’s higher UK inflation that has Treasury yields heading higher.   In a reminder that inflation is not only a domestic story but a global one, UK inflation accelerated to the highest level in 40…

China Weakness Has Treasury Prices Higher A trio of reports out of China overnight suggest the second largest global economy has hit another soft patch and that has risk assets on the back foot this morning with Treasuries in the green.   Retail sales, industrial production and investment all slowed in July and the jobless…

The reality is that banks don’t think from the customer’s perspective enough. The customer experience is horrible for many bank processes. Bankers often think from the bank’s perspective or from the regulator’s perspective. Not understanding your customer can lead to a brand and products misaligned with the customer’s needs resulting in an erosion of a…

Competition is intense, and every bank is looking for a competitive advantage. Better products, faster service, or insightful advice can translate into additional loans, better credit spreads, or extra fee income. Sometimes just a graphics tool can help a banker win more loan business. At SouthState, our commercial lending teams use an online proposal generator,…

Cooler Inflation Numbers Continue to Roll In First, it was the cooler-than-expected CPI report on Wednesday. That was followed by July PPI yesterday that printed negative for the first time since April 2020. That was joined this morning by a better-than-expected Import-Export Price Index.   Admittedly, this data series doesn’t carry the weight of the…

Finally, a Cooler CPI Report For the first time in what seems like forever, CPI came in cooler than expected and markets, both Treasuries and stocks, are rallying as a result.   The overall inflation rate was unchanged for the month versus the 1.3% increase in June and better than the 0.2% expected. It’s the…

With 100+ public banks reporting, we have more than a representative sample to see 2Q 2022 bank earnings trends and derive some operational insights on bank performance. We touched on the 33 Items That Stakeholders Want to Know, which highlights some of the industry’s concerns and serves as a good checklist of items to touch…

A yield curve is a relationship between yield and different maturity dates. The yield curve’s slope can provide insight into future interest rate changes and economic activity. There is much discussion in the market about the current inverted yield curve between the two and ten-year Treasury yields. However, for bankers, the critical dates on the…

Treasuries Shrug Off Strong July Jobs Report Treasury prices are higher this morning as the downdraft created by the stronger-than-expected July employment report was short-lived. We remain hard-pressed to see a catalyst to materially higher rates in the near-term as the market interprets the hot jobs market as a reason for the Fed to remain…

Strong Job Growth Continues and Wage Gains Accelerate Nonfarm payrolls increased 528 thousand with those gains continuing to be widespread while the unemployment rate dipped a tenth to 3.5%. Expectations were for 250 thousand jobs and the increase was well above June’s 398 thousand new jobs. It’s the highest monthly gain since February’s 714 thousand…

Fed Pushes Back on Thoughts of a Dovish Pivot   Yesterday, a pair of Fed officials firmly pushed back on the notion that Fed Chair Powell’s comments after last week’s 75bps rate hike represented something of a pivot to a more dovish Fed in upcoming meetings.   San Francisco Fed President Mary Daly and Chicago…