U.S. and World News
- Following the coordinated terrorist attacks in Paris last week, signs are already emerging showing that they have had a large economic impact on one of the most visited cities in the world. Surveys suggest that restaurant sales in Paris have plunged 44% during the past week compared to the same period last year, while hotels have seen a 57% decline in their business. Airlines have also reported that travel to the French capital has plummeted.
- Minutes from the October Federal Reserve meeting did not reveal anything significant as most participants thought that the conditions for a hike in interest rates “could well be met by the time of the next meeting.” Participants held off from raising rates in October due to worries about weaker than expected reading on labor market measures, though after the positive October jobs reports, these worries may have been alleviated.
- Japan has slid back into recession after the 3rd quarter showed a -0.8% contraction as consumer spending has remained soft and businesses have cut back on investments. This follows a -0.7% growth rate in the 2nd quarter and marks just the latest setback for Prime Minister Shinzo Abe and his “Abenomics” policies as the country tries to battle deflation and return to growth.
- Equity markets bounced back this week, posting their strongest week so far this year. The S&P 500 ended the week up 3.32%, closing at 2,089. Similarly, the Dow Jones increased 3.45% and closed at 17,824. Year to date, the S&P is up 3.37% and the Dow is up 2.24%.
- Yields in the Treasury markets were little changed this week. The 10 year Treasury bond now yields 2.26% while the 5 year Treasury bond now yields 1.69%.
- The spot price of WTI Crude Oil fell again this week. Prices decreased by 0.86% closing at $40.39 per barrel. In 2015, WTI Oil prices are down 24.18%.
- The spot price of Gold decreased this week, losing 0.54% and closing at $1,078.01 per ounce. Year to date, gold prices are down 8.98%.
- Initial jobless claims came in at 271,000 which was a decrease from the prior week’s figure of 276,000. The Labor Department noted that there were no special factors that affected the claims figure. The four week moving average for claims now stands at 270,750.
- The Consumer Price Index (measure of inflation) increased by 0.2% in October, in line with expectations. Headline CPI is now up just 0.2% over the last 12 months, thanks to the steep decline in energy prices. Core CPI (excludes food and energy prices) was up 0.2% in October and is now up 1.9% over the last year.
Fact of the Week
- According to the Social Security Administration, 43% of men and 37% of women take their Social Security retirement benefits at their FRA (full retirement age) or older.
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