US Treasury Secretary Yellen is on a wires saying:
- US budget does not need to be balanced to be on a fiscally sustainable path
- Critical to reduce deficits to stay on fiscally sustainable path
- We are not looking for a capital increase at World Bank at this time.
- US is strongly opposed to World Bank lending to China
- as a some concerns about commercial real estate. FSOC (Financial Stability Oversight Council) is quite focused on it.
- Refinancing of real estate loans amid high vacancies will put a lot of stress on property owners
- there may be some financial institutions that are quite stressed by commercial real estate issues
The KRE ETF (regional bank ETF), is down -0.78% in trading today. Although the price is down sharply over the last week or so of the trading, it remains above its 100-day moving average at $45.91. The low price today reached $46.89.
KRE ETF is down today
Speaking of the U.S. Treasury, they will auction $54 billion of three-year notes at 1 PM ET today. That will be followed by auctions fo 10 and 30 year coupon issues tomorrow and on Thursday. The US auction – depending on demand – influence rates and other unusual instruments including Forex, and stock markets. Generally speaking, an auction that is not well received by investors both domestically and internationally, will lead to a backup in rates, lower stock prices and a higher dollar, and vice versa