Recent stress in the short-term repurchasing (repo) market has raised concerns about a potential “liquidity crisis” in the financial system.

As shown in the LPL Chart of the Day, interest rates on repo market agreements jumped last week amid a shortage of cash available to lend, forcing the Federal Reserve (Fed) to inject liquidity into the market to stabilize rates.

In a repo agreement, a holder of a U.S. Treasury security sells it for cash for a short period of time, often overnight, with an agreement to buy the security back for a slightly higher amount. This is treated as a short-term ca

The German economy, typically a key growth engine for Europe, is sputtering. In fact, it may be entering a recession as we speak.

As shown in the LPL Chart of the Day, German gross domestic product (GDP) is expected to grow only 0.1% in both the third and fourth quarters, according to Bloomberg consensus forecasts, after contracting modestly in the second quarter. Most economists use two consecutive quarters of declining GDP as the benchmark for measuring recession.

“What has typically been the engine of growth in Europe has been a drag,” said LPL Chief Investment Strategist John Lynch. &ldq

Recent stock gains may not just be about a better trade tone or renewed central bank support. U.S. economic fundamentals have also improved.

The Citi U.S. Economic Surprise Index, a running average of economic data compared to economists’ forecasts, has recently reached levels not seen since April 2018, as shown in LPL Research’s Chart of the Day. Stocks have climbed back near records as data has improved, and stronger economic trends could provide support for further advances.

Large economic surprises in recent data span key economic sectors and include building permits, housing starts, ser

As shown in the LPL Chart of the Day, the 10-year Treasury yield jumped 34 basis points (0.34%) in the week ending September 13, then gave back half that gain in a 17 basis point (0.17%) slide last week. The benchmark yield hasn’t moved at least 15 basis points (0.15%) in two consecutive weeks since November 2016.

The 10-year yield’s rapid ascent earlier this month was sparked by optimistic trade headlines and improving economic data, especially regarding inflation. On September 13, the 10-year yield jumped 12 basis points (0.12%) amid news that U.S.  retail sales topped expectations and that China