| | | Markets Signal a Slowing Economy | | Market participants generally anticipate a slow August, where junior staff watch the trading desks as more senior staff depart for time off. But this August has defied expectations with geopolitical concerns surfacing around the world. | | If you woke up from a decades-long nap in today's world, you would be forgiven for some confusion over market indicators. Certainly, risk aversion assets are securing multi-year highs even as stocks swooned 3 percent midweek, one of the year's worst declines. Gold reached a six-year high, and the U.S. dollar moved to two-year highs. Also this week, one of the strongest slowdown indicators — the closely watched yield curve of two-year Treasury yields against 10-year Treasury yields — inverted for the first time since 2007, CBS News reported. | | In another eye-popping data point, about 60 percent of the 500 stocks in the Standard & Poor's index carry dividend yields greater than the 10-year Treasury yield. Also, the 30-year Treasury rate hit all-time record lows this week touching levels below 2 percent for the first time in history. And around the world there is $15 trillion of negative-yielding debt, according to CNBC. | | Watch the video | | If we can help you with any Foreign Exchange needs, please email foreignexchange@cnb.com or call (800) 447‑4133. | | Want to learn more about international finance, economics, and global events? Sign up for our other Foreign Exchange emails and videos! | | | | | | | Follow City National Bank on social media: | | | | | | Non-deposit investment products: | | • | Are not FDIC insured, | | • | Are not deposits or other obligations of City National Bank and are not guaranteed by City National Bank, and | | • | Are subject to investment risks, including possible loss of the principal invested. | | | | | This report is for general information and education only and was compiled from data and sources believed to be reliable. City National Bank does not warrant that it is accurate or complete. Opinions expressed and estimates or projections given are those of the authors as of the date of the report with no obligation to update or notify of inaccuracy or change. This report is not a recommendation or an offer or solicitation to buy or sell any financial instrument discussed. It is not specific investment advice. Financial instruments discussed may not be suitable for the reader. Readers must make independent investment decisions based on their own investment objectives and financial situations. Prices and financial instruments discussed are subject to change without notice. Instruments denominated in a foreign currency are subject to exchange rate and other risks. City National Bank (and its clients or associated persons) may engage in transactions inconsistent with this report and may buy from or sell to clients or others the financial instruments discussed on a principal basis. Past performance is not an indication of future results. This report may not be reproduced, distributed or further published by any person without the written consent of City National Bank. Please cite source when quoting. | | | | | | |
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