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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: j g cordes who wrote (18663)	6/28/1999 1:11:00 PM
From: Les H	Respond to of 99985

The World Awaits FOMC Short covering before the FOMC meeting tomorrow is pushing treasury prices higher. Thirty-year bonds are up 17/32, yield 6.10%. Two-year notes are up 4/32, yield 5.67%. The main event of the week will be the two-day FOMC meeting, which begins tomorrow. Expectations are for a twenty-five basis point rise in the fed funds target. This would increase it to 5.0%. We will want to watch to see if the Fed maintains its tightening bias. If they do, the market will be looking for another tightening at the August meeting. Personal income for May rose .4% with consumption up .5%. This was very close to expectations. Disposable income (income after taxes) rose .3%. The savings rate fell 1.2% to a record low. This number clearly indicates continuing vibrant consumer spending, a concern for the Fed. Bonds had little reaction to the data. President Clinton says if the budget surplus is used to retire the debt, the country would be debt free by 2015. In addition to the FOMC meeting there will be a plethora of economic data released. The most important will be the National Association of Purchasing Managers survey on Thursday and the unemployment data on Friday. Have a great day. bonds-online.com