Jump to main content

Blog

Rates Sink to New Lows on Record GDP Decline

A slate of weak economic data and a dour assessment of the economy by Fed Chair Powell pushed rates to new lows, as Treasury yields declined by three to five bps.  The Federal Reserve's meeting ended Wednesday as expected with no change to the Fed funds target.  However, Chair Powell's candid assessment of the challenges facing the economy helped pushed rates lower as the Fed is committed to accomodative policy for the foreseeable future. 

Thursday's release of second quarter GDP showed that the US economy shrank by an astounding 32.9% on an annualized basis.  The decline was by far the largest in modern economic history and highlighted the level of economic devastation wreaked by efforts to combat the spread of the coronavirus.  The weekly jobless claims release was similarly dire, with initial claims for unemployment insurance climbing for the second week in a row and the number of Americans continuing to receive jobless benefits rising back above 17 million.

View All Blog Posts