Economic news dominated headlines this week apart from the domestic administration travel ban which came into affect Thursday. The final reading of first quarter Gross Domestic Product (GDP) showed a 1.4% annualized increase in economic output and inflation, measured by personal consumption expenditure (PCE), increased in line with expectation over the same period. Much of the reported economic data added to market’s acceptance of hawkish tones by Fed officials in a number of speeches that took place during the week. In Europe an initial interpretation of ECB President Mario Draghi’s speech was softened later by further comments from the central bank about its stimulus program.

Markets broadly gained in the second quarter of 2017 from domestic equities to emerging market bonds, although movement along the way was not consistent. The domestic large company index gained just over 3.0% for the trailing three months ended June 30 while the small company index only returned slightly more than half that at 1.7%. The broad commodity index looked very strong during the week, lifted by oil’s eight continuous days of gains just before the holiday weekend’s heightened driving schedule. The cumulative advance for the commodity is over 8% since its most recent low. The hawkish tones from central bank officials have led to a pickup in yields over most Treasury maturities.

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