- The yield on the U.S. 10-Year Treasury note reached 1.5%
- Consumer expenditures rose 0.8% in August from the prior month
- The Consumer Confidence Index fell to 109.3 in September from a revised 115.2 in August
Top Three Market Headlines
U.S. 10-Year Treasury Yield Reaches 1.5%: For the first time since June, the yield on the 10-year U.S. Treasury note reached 1.5% last week. The 10-year yield, which serves as an economic benchmark for borrowing rates, has risen steadily after hitting an early August low of 1.17%. The rise comes amid greater clarity from the Federal Reserve about plans to pare monthly bond purchases beginning in November and potentially raise interest rates next year, along with recent declines in coronavirus cases, which could rejuvenate consumer spending and economic activity.
Consumer Spending Ticks Up in August: The Bureau of Economic Analysis reported last week that U.S. personal consumption expenditures (PCE) rose in August at a seasonally adjusted rate of 0.8% from the prior month. The recent gain reflects increased spending for food and beverages as well as "other" nondurable goods including household supplies and recreational items. Services also had widespread increases, led by personal care, clothing services, housing, and healthcare. These gains were partly offset by a decrease in spending for motor vehicles and parts. At the same time, rising prices accounted for half of the dollar increase in spending, as the PCE price index rose 0.4% during the month.
Consumer Confidence Weakens: Consumer confidence continued to wane in September as concerns about the Delta variant and inflation weighed on outlooks. The Conference Board, a private research group, reported last week that its Consumer Confidence Index, which reflects consumers' current and six-month future outlooks for the economy and the labor market, fell to 109.3 in September from a revised 115.2 in August. Consumers' outlooks for both current and future business conditions declined from the prior month. The Index has now fallen nearly 20 points from a post-pandemic high of 128.9 in July.