Perspective: Morning Commentary for March 15

By: Arlan Suderman, Chief Commodities Economist

Wed, 15 Mar 2023, 13:39

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

March 15 – It was another “risk-off” session overnight, as traders react to a report that Saudi Arabia will not invest more money into Credit Suisse. Traders are also reacting to this morning’s economic data release. The VIX is trading near 27 this morning, reflecting elevated fear levels once again. The dollar index surged overnight, and it is now trading near 104.7. Yields on 10-year Treasuries are trading near 3.46%, while yields on 2-year Treasuries are trading near3.86%. Crude oil prices are 4% lower, while the grain and oilseed markets were mixed. Crude oil prices broke key chart support earlier today, which creates additional headwinds. One of the keys to watch today will be the VIX, which is Wall Street’s fear index.

European bank stocks sold off today, led by Credit Suisse falling to new lows on investor concerns about stresses in the banking sector. Credit Suisse shares fell more than 20% at one point, contributing to a more than 6% decline in Europe’s banking index. The selling spread overseas to pressure U.S. stock futures as well after a day of relative calm on Tuesday. BlackRock Chief Executive Laurence Fink warned today that regional banks remain at risk in the United States, but he also predicted further rate hikes to fight lingering inflation problems. His comments also noted concerns that a prolonged period of low interest rates drove some asset owners to raise their exposure to higher-yielding investments that are not now easy to sell. Rising rates are making it more difficult for some businesses to pay back and/or to service loans, increasing risks for regional banks holding those loans.

The various business networks closely followed by Wall Street pile on concerns for investors as they parade out a string of politicians and “experts” proclaiming doom and gloom. Many of these guests are trying to predict the future based on past market behavior, failing to recognize that the dynamics of the current situation are totally different than previous challenges. M2 money supply at $21.1 is down from $22 trillion last April when the rate hikes and quantitative tightening started, but it’s still up 38% from where it was at the start of the pandemic. Wage inflation is running between 5% and 6%, with nearly two job openings for every worker still looking for a job. Interest rates were near zero for several years during which both quantitative easing and fiscal stimulus pumped trillions of dollars into our economy. Some of that stimulus is still occurring. We’ve had a free lunch for several years, and there is never a free lunch in the economy. The bill always comes due. The problem is, we never want to pay the bill in our culture. Policymakers created the problem, and now they’re trying to throw around the blame while adding to regulations to make it look like they’re fixing the problem. I’ve said for the past year that we wouldn’t be able to fix this problem without experiencing some pain, but now traders, analysts and politicians are crying for relief at the first sign of pain. Frankly, free money leads to bad decisions, and we’re seeing the consequences of some of those bad decisions. I’m sure the Fed is quickly assessing the risks of regional banks ahead of next week’s meeting. A pivot of policy will be seen as confirmation of banking risks, while staying the course would be seen as a sign of commitment to tackle inflation. In the end, we won’t fix the problems at hand without experiencing some pain, which will eventually make us stronger.

The producer price index came in colder than expected, contracting 0.1% month-on-month in February. That was far different than the 0.3% growth expected by analysts, and it was a marked difference from the 0.7% growth seen the previous month. The PPI rose 4.6% year-on-year in February, down from 6.0% the previous month and well-below analyst expectations of 5.4%. The core PPI that excludes the more volatile food and energy sectors was flat in February – no inflation – versus the 0.5% growth seen the previous month and versus analyst expectations of 0.4%. The core PPI was up 4.4% year-on-year in February, down from 5.4% the previous month and down from analyst expectations of 5.2%. Breaking it down, the PPI for goods was down 0.2% month-on-month in February, while the PPI for services was down 0.1%. The PPI for foods fell 2.2% month-on-month, leading the decline for the month, while energy fell 0.2%, trade fell 0.8% and transportation and warehousing fell 1.1%. Today’s data provides additional evidence of declining inflationary pressures, which I’m sure the Federal Reserve will take note of when they contemplate their policy decisions next week. This is not the entirety of the picture that they must consider, but it is a notable portion of it.

Retail sales fell by 0.4% month-on-month in February, down from 3.2% gains the previous month and worse than the 0.3% expected by analysts. However, retail sales minus vehicles only fell 0.1% month-on-month in February, down from 2.4% gains the previous month and below analyst expectations that they’d grow by 0.2% during the month. Furthermore, retail sales minus vehicles and gas were flat in February, after gaining 2.8% in January and much better than the 0.9% decline expected in February. The trade will look at the headline number and think that this means that we’re heading into a recession, but the bottom line here is that retail sales were very constant in February when looking beyond vehicle sales and declining gasoline prices and sales in a short winter month.

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Perspective: Morning Commentary for August 7

August 7 – The U.S. economy unexpectedly lost 23k jobs in July, dramatically below market expectations of an 80k increase and marking the worst Non-Farm Payrolls print since February. Furthermore, May and June were both revised sharply downward, with combined revisions showing 103k fewer jobs than previously reported. Outside of the healthcare sector, which added 22k jobs in July, the losses were very broad-based. Government payrolls saw the largest decline, shedding 53k jobs in July, the largest seen since October 2025, while June was revised down to show a loss of 10k jobs as well. The private sector at least saw growth, adding 30k jobs in July, now matching the month prior after it was revised down from the 49k initially reported, and substantially missing forecasts of 78k jobs being added. This is a sharp reversal in course from the largely better than expected U.S. labor data seen earlier this week.

Mike CastleFri, 07 Aug 2026, 13:26

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Perspective: Morning Commentary for August 6

August 6 – This morning’s stronger-than-expected U.S. labor data offered markets some relief, reinforcing confidence in the economy while giving the Fed greater flexibility to raise rates should inflationary pressures reaccelerate in next week’s July data. Stock futures are pointing to a mixed open to start the day, with the tech-heavy Nasdaq showing the most weakness. The VIX has fallen notably from yesterday’s spike above 18.4 as it starts the day hovering just below the 16-mark. The dollar is quietly higher as it trades just above 99.8, holding in the tight range seen thus far this week as traders continue to digest data to shape expectations for the Fed’s next move, which we’ll dive into in more depth below. Long-term treasury yields have relaxed slightly from their recent spike, with 30-year yields starting the day trading just above 5.19%, while 10-year yields trade above 4.64%, and 2-year yields sit below 4.22%. Crude oil is modestly higher to start the session after sharp declines earlier in the week, with nearby WTI up 1.8% to trade at $76.40 and nearby Brent up 2.4% to trade at $81.40. Meanwhile, the ags are quietly mixed to start the day.

Mike CastleThu, 06 Aug 2026, 13:24

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Perspective: Mid-Day Commentary for August 5

August 5 – The Dow Jones is ripping higher for yet another session, up safely over 500 points at the time of this writing to carve out another record high; the S&P and NASDAQ are a bit less enthusiastic but the former is still making its own record high, while the latter is less than 500 points off its own top thanks to a strong ongoing week of trade. The dollar is churning lower this morning in an effort to re-test Monday’s 1 ½-month low, while the ten-year note has flipped higher in the mid-morning hours. The CME FedWatch tool interesting has market odds of a quarter-point rate hike next month coming closer to a 50-50 proposition as crude oil prices decline.

Mike CastleWed, 05 Aug 2026, 15:19

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