Morning View

In the U.S., 3rd quarter GDP grew +3.1% annualized, beating expectations.

International

In the United States, the Gross Domestic Product (GDP) for the 3rd quarter grew at an annualized rate of +3.1%, according to the final estimate. This performance was higher than the +2.8% expected by the analysts' consensus and the figure recorded in the 2nd quarter of the year (+3.0%). It is worth noting that the Federal Reserve (Fed) raised its growth forecast for the year to +2.5%.

U.S. Treasury bond yields traded mixed during yesterday's trading, compressing in the short maturities and widening in the medium and long end of the curve. Thus, the 1-year bond yielded 4.26%, the 3-year bond closed at 4.34% and the 10-year bond widened to 4.56%. The main US equity indices ended with slight declines in most cases, with the Nasdaq and S&P 500 down -0.1%, and the Dow Jones remaining stable.

The week's focus in the United States will be on the release of the Personal Consumption Expenditure (PCE) price index - the Fed's preferred inflation measure for monetary policy decisions - for November, with an estimated year-on-year increase of +2.5% and +2.9% in the non-food and non-fuel (core) measure.

On the other hand, the last monetary policy meetings of the year took place in the United Kingdom and Mexico. On the one hand, the Bank of England kept the reference rate unchanged at 4.75%, while the Bank of Mexico reduced its interest rate to 10% from the previous 10.25%. It should be noted that both decisions were in line with analysts' consensus estimates.

Fuente: PUENTE Hnos, Bloomberg

The Federal Reserve lowered the benchmark rate for the third consecutive meeting to the 4.25%-4.50% range.

Internacional

The US Federal Reserve (Fed) cut the interest rate to the 4.25% - 4.50% range, in line with expectations. In this way, it complied with the 4 estimated reductions in September, which represents an adjustment of -100 basis points from the maximum level reached (5.5%). The Bank justified its decision on the grounds that inflation could remain above the medium-term target of +2%, while the labor market continues to show strength. Therefore, they restricted the number of expected reductions for 2025 compared to what they expected months ago, reflecting a more cautious stance in an environment with higher inflation than previously anticipated. In this regard, the rate is projected to reach a range of 3.75%-4.0% by the end of the year, which would imply two adjustments.

The quarterly update of macroeconomic projections reveals an upward correction in most cases for this year and next year. In terms of economic growth, +2.5% is expected for 2024 versus +2.0% previously, core PCE inflation (the Fed's preferred measure for monetary policy decisions) of +2.8% versus +2.6% estimated in September; meanwhile, unemployment is expected to be lower at around 4.2% (when 4.4% was expected).

In this environment, U.S. Treasury yields widened across the curve yesterday. Thus, the 1-year bond advanced to 4.29%, the 3-year bond closed at 4.36% and the 10-year at 4.52%. However, the main US stock indexes ended with generalized declines, with the Nasdaq being the most affected with -3.6%, followed by the S&P 500 with -2.9% and the Dow Jones with -2.6%.

In the Eurozone, November inflation was in line with estimates in most cases. Specifically, it fell -0.3% month-on-month and advanced +2.2% year-on-year versus the +2.3% projected; while in the measure that excludes food and fuel, it registered -0.6% month-on-month and +2.7% year-on-year. In this environment, the German Treasury bond yield rose to 2.25%.

Fuente: PUENTE Hnos, Bloomberg