Wednesday, November 8, 2017
MANAGING DIRECTOR: Scott Carrithers   PORTFOLIO SALES AND SERVICE: Steve Panknin • George Morris • Jeff Goble • Chris Thompson • Sean Doherty Robert Brickson • Kevin Doyle • Lonnie Harris •  Mark Tranckino • Robert Schuyler  Tom Toburen • Josh Kiefer • Nicole Burczyk • Kelley Frye • Natalie Regan • Aaron Stoffer • Chuck Honeywell

US Treasury Market
Date	1 mo	3 mo	6 mo	1 yr	2 yr	3 yr	5 yr	7 yr	10 yr	20 yr	30 yr
11/1/17	1.06	1.18	1.30	1.46	1.61	1.74	2.01	2.22	2.37	2.63	2.85
11/2/17	1.02	1.17	1.29	1.46	1.61	1.73	2.00	2.21	2.35	2.61	2.83
11/3/17	1.02	1.18	1.31	1.49	1.63	1.74	1.99	2.19	2.34	2.59	2.82
11/6/17	1.03	1.19	1.30	1.50	1.61	1.73	1.99	2.17	2.32	2.58	2.80
11/7/17	1.05	1.22	1.33	1.49	1.63	1.75	1.99	2.17	2.32	2.56	2.77

                                                                                                               

                                                                                                                Source: U.S. Department of the Treasury, as of 11/7/17   

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Market Expectations…. Or the Fed?

Both the Fed Funds Futures and the FOMC Dot Plot are tools investors may reference to calibrate interest rate forecasts.  Currently, however, there is a misalignment between market expectations and the Dot Plot. 

For example, the Fed Dot Plot median implies three 25bp rate hikes within the next 12 months.  In apparent contrast, Fed Funds Futures are currently forecasting just one rate hike through the end of next year (and the 2019 forecast further illustrates this divergent opinion). 

So there are no easy answers these days, but there are more questions:

1)    If interest rates are 75basis points next year, how will your portfolio respond in terms of price and cashflow? 

2)    How will your portfolio cashflow scenario vary should rates more closely mirror the more gradual ascent suggested by Fed Funds Futures?

Your Capital Markets Representative is available to review these questions and discus investment options that align with your outlook for the future.

This information is intended for institutional investors only. The material provided in this document/presentation is for informational purposes only and is intended solely for private use. Past performance is not indicative of future results. This material is not intended as an offer or solicitation for the purchase or sale of any financial instruments.

•Not FDIC Insured •No Bank Guarantee •May Lose Value