Market Digest          
3.22.17          
OBSERVATIONS
With Stock Valuations Rising, Are We Close to Recession?
We may be past the midpoint of the current business cycle, but there is no magic formula for predicting recessions and bear markets. Every cycle is different. But, the five data points below cover a variety of perspectives and help capture a more complete view of the economic and market environment. They are meant to be considered collectively, not individually. 

Five Forecast Measures: Are They Signalling a Warning?
Five Forecasters


MARKET UPDATE
Last Wednesday, March 15, the Fed announced a quarter-point rate hike and the market rallied.  In part because the hike was expected, but also because the comments from Fed Chair Janet Yellen indicated that the FOMC would maintain its economic projections, and a measured pace of future increases.
Equity Index Returns through March 17_ 2017
Source: Yahoo! Finance
ECONOMIC NEWS
> Inflation: The interest rate hike from the Fed may have received all the attention last week, but the Consumer Price Index report also came out last Wednesday and it shows prices continue to climb.  Consumer prices rose only 0.1% as was expected, b ut the overall year-over-year rate was up 2 tenths to 2.7%. The core rate, which excludes energy, is 2.2%.

CPI March 16_ 2017


> LEI: The Conference Board Leading Economic Index (LEI) for the US increased 0.6% in February to 126.2, following a 0.6% increase in January, and a 0.6% increase in December. 
Widespread gains  across a majority of the leading indicators points to an improving economic outlook for 2017.

LEI February 2017


> Consumer Sentiment:  The University of Michigan's Consumer Sentiment Index hit 97.6 in March, up from 96.3 in the previous month. The monthly survey of 500 consumers measures attitudes toward topics such as personal finances, inflation, unemployment, government policies and interest rates.

Consumer Sentiment March 2017


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