Market commentary

In a speech from the Fed’s annual monetary symposium held in Jackson Hole, WY, Federal Reserve Chairman Ben S. Bernanke said the U.S. central bank “will do all that it can” to ensure a continuation of the economic recovery. The Fed chairman gave a detailed analysis of the economy and said growth during the past year has been “too slow” and unemployment “too high.” Bernanke also stated the Fed has several tools if prices decelerate, or job growth stagnates, including shifting the composition of its bond reinvestment strategy.

Earlier this morning the Commerce Department reported GDP for Q2 was revised lower from an initial estimate of 2.4% to 1.6%. This was better than the anticipated revision estimates that ranged from 1.00% to 1.40%. As a result, Treasuries sold off immediately following the release with the 10-year down half-a-point, while stocks moved higher. The sell off in Treasuries continues with the 10 year now lower in price by .875% at a yield of 2.575% and the 30 year bond is lower in price by 1.625% with the yield rising to 3.605%. Recall that as recently as Wednesday morning the yield on the 10 year note traded as low as 2.42%.