Clarksville Weekly Market Snapshot from Frazier Allen for the week of June 22nd, 2015

Clarksville, TN – In its monetary policy statement, the Federal Open Market Committee recognized that “economic activity has been expanding moderately after having changed little during the first quarter.” Labor market slack has “diminished somewhat.” Growth in consumer spending has been “moderate,” while the housing sector “has shown some improvement.”

In the revised Summary of Economic Projections, Fed officials lowered their forecasts of 2015 GDP growth, but raised slightly their expectations for growth in 2016 and 2017.

However, she emphasized that “the initial increase should not be overstated: The stance of monetary policy will likely remain highly accommodative for quite some time after the initial increase in the federal funds rate,” adding that “although policy will be data dependent, economic conditions are currently anticipated to evolve in a manner that will warrant only gradual increases in the target federal funds rate.”

Economic data were mixed, consistent with a moderate pickup in growth in 2Q15. While there were no major surprises in the policy statement and Yellen covered no new ground in her post-FOMC press conference, financial market participants seemed relieved once that was out of the way.

However, Greece remained on ongoing concern, as debt negotiations with the IMF broke down and a run on the banks began.

Next week, the economic data have some potential to surprise (monthly changes in durable goods orders and new home sales are notoriously erratic). However, these figures aren’t going to alter the bigger picture. The third estimate (second revision) of first quarter GDP growth (a -0.7% annual rate in the second estimate) is expected to be revised to show a smaller decline (or perhaps a slight increase).

May personal income and spending figures should help fill in the consumer picture for 2Q15. This is currently being billed as the final make-or-break point in Greece’s crisis, but every other time has ended with the can being kicked further down the road. We’ll see.

Important Disclosures

Past performance is not a guarantee of future results. There are special risks involved with global investing related to market and currency fluctuations, economic and political instability, and different financial accounting standards. The above material has been obtained from sources considered reliable, but we do not guarantee that it is accurate or complete. There is no assurance that any trends mentioned will continue in the future. While interest on municipal bonds is generally exempt from federal income tax, it may be subject to the federal alternative minimum tax, state or local taxes. In addition, certain municipal bonds (such as Build America Bonds) are issued without a federal tax exemption, which subjects the related interest income to federal income tax. Investing involves risk and investors may incur a profit or a loss.

US government bonds and treasury bills are guaranteed by the US government and, if held to maturity, offer a fixed rate of return and guaranteed principal value. US government bonds are issued and guaranteed as to the timely payment of principal and interest by the federal government. Treasury bills are certificates reflecting short-term (less than one year) obligations of the US government.

Commodities trading is generally considered speculative because of the significant potential for investment loss. Markets for commodities are likely to be volatile and there may be sharp price fluctuations even during periods when prices overall are rising. Specific sector investing can be subject to different and greater risks than more diversified investments.

Tax Equiv Muni yields (TEY) assume a 35% tax rate on triple-A rated, tax-exempt insured revenue bonds.

Material prepared by Raymond James for use by its financial advisors.

The information contained herein has been obtained from sources considered reliable, but we do not guarantee that the foregoing material is accurate or complete. Data source: Bloomberg, as of close of business June 18th, 2015.

©2015 Raymond James Financial Services, Inc. member FINRA / SIPC.