Clarksville Weekly Market Snapshot from Frazier Allen for the week of March 1st, 2015

Clarksville, TN – Greece’s reform proposals were accepted by European finance ministers, effectively kicking the can down the road for another four months.

In her monetary policy testimony, Fed Chair Janet Yellen signaled that the Fed will begin to consider raising short-term interest rates on a meeting-by-meeting basis. Before then, the Fed will change its forward guidance (currently, the language suggests that the Fed can be “patient” in deciding when to raise rates).

Yellen indicated that for the Fed to raise rates: 1) it must see further improvement in the job market; 2) it must expect further improvement in the job market beyond that; and 3) it must be “reasonably confident” that inflation will move toward the 2% goal.

The Consumer Price Index fell 0.7% in January, down 0.1% from a year earlier (the first year-over–year decline since October 2009). Ex–food & energy, the CPI rose 0.2% (+1.6% y/y). The estimate of 4Q14 GDP growth was revised to a 2.2% annual rate (vs. +2.6% in the advance estimate). Most of the revision was due to slower inventory growth.

Private Domestic Final Sales (GDP less net exports, the change in inventories, and government) rose at a 3.5% annual rate (vs. +3.3% in 3Q14). Consumer spending rose at a 4.2% pace (vs. 4.3% in the advance estimate), while business fixed investment rose to +4.8% (from +1.9%). The week’s other data were mixed, but consistent with moderate growth in the near term.

Next week, the economic calendar remains packed, with plenty of potentially market-moving data releases. The focus is expected to be on Friday’s employment report, which should reflect an impact from adverse weather.

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.

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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 February 26th, 2015.

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