The Daily Advisor: March 4, 2024

Three Things To Know Today  

1. Advance Discounts Extended Through March 2024 - Call to Take Advantage
In our ongoing commitment to support your liquidity needs, we are extending our long-term, 5 basis point (bps) discount on callable, fixed-rate, and amortizing advances through March 31, 2024. To take advantage of this, you need to call us directly at 855.345.2244, option 1.

2. Read Our Latest White Paper on Secondary Mortgage Solutions
We support our members in every mortgage market environment through our Mortgage Partnership Finance® (MPF®) Traditional and Downpayment Plus® (DPP®) programs. In our new white paper, we analyze the state of the mortgage market, benefits of the MPF Traditional Program, and how to pair our DPP programs with MPF products.

3. Tell Your Story – We Want to Hear From You!
We want to share how you are making a difference in your communities so we can celebrate and elevate the great accomplishments we make together. Visit fhlbc.com to see examples of how other members are making an impact and submit your information in the form share your story with us!

Market Commentary

U.S. Treasuries rallied while equities posted gains on Friday. Treasury yields edged higher overnight and into early morning trading. Yields reversed course and began to decline after economic data releases showed continued contraction in the manufacturing sector and slowing construction spending. Shorter tenors led the rally that continued throughout the session as yields ultimately finished 5-10 bps lower across the curve.

The ISM Manufacturing Purchasing Managers’ Index (PMI) fell 1.3 points to 47.8 in February, marking the 16th consecutive month in contraction territory. The new orders index decreased 3.3 points to 49.2, contracting again after growing in January. The index for employment also declined 1.2 points to 45.9 as the production index fell 2.0 points to 48.4.

The University of Michigan Consumer Sentiment Index was downwardly revised to 76.9 in the final reading for February. However, inflation expectations remained unchanged at 3.0% and 2.9% for the one-year ahead and five-years ahead outlook, respectively.

Construction spending fell 0.2% in January, missing expectations of a 0.2% increase and following the 1.1% increase in December. Residential construction spending was up 0.2% month-over-month but was offset by a 0.4% decline in nonresidential construction. Single-family homes increased 0.6% boosting residential construction however multi-family construction decreased 0.4% during the month.

 

Disclaimer
The data and valuations provided in this document are for information purposes only and are provided as an accommodation and without charge. The Federal Home Loan Bank of Chicago makes no representations or warranties about the accuracy or suitability of any information in this document. This document is not intended to constitute legal, investment, or financial advice or the rendering of legal, consulting, or other professional services of any kind.

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