The US trade deficit shrank in June as imports slid to the lowest level since 2021. New York Fed President Williams sees Federal Reserve policy remaining restrictive for some time and Fed Governor Bowman said that additional rate hikes will likely be needed. Philly Fed Prez Harker suggested the Fed can now be patient and not hike in Sept. The NFIB optimism index released this morning showed a slight increase over forecast at 91.9%. Business owners continued to report inflation as being their biggest problem in operating their business. MBS closed up 8 bps. Stocks were down 20 points. The Federal Trade Commission (FTC) agreed to drop its challenge to Intercontinental Exchange Inc.’s (ICE) proposed deal with Black Knight Inc. in a joint stipulation that allows them to work toward a settlement.

In more detail:

  • The US trade deficit shrank in June as imports slid to the lowest level since 2021. This could be a sign that economic activity is slowing down as consumers are buying less imported goods.
  • New York Fed President Williams sees Federal Reserve policy remaining restrictive for some time and Fed Governor Bowman said that additional rate hikes will likely be needed. This suggests that the Fed is committed to fighting inflation even if it means slowing economic growth.
  • Philly Fed Prez Harker suggested the Fed can now be patient and not hike in Sept. This is a more dovish view than the other Fed officials mentioned above.
  • The NFIB optimism index released this morning showed a slight increase over forecast at 91.9%. However, business owners continued to report inflation as being their biggest problem in operating their business. This suggests that inflation is still a major concern for businesses.
  • MBS closed up 8 bps. This suggests that investors are becoming more risk-averse as they anticipate a slowdown in economic growth.
  • Stocks were down 20 points. This is also a sign that investors are becoming more risk-averse.
  • The Federal Trade Commission (FTC) agreed to drop its challenge to Intercontinental Exchange Inc.’s (ICE) proposed deal with Black Knight Inc. This is a positive development for the two companies as it allows them to move forward with their merger.

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