November 2020 Economic Update

A Light at the End of the Tunnel?

November 13, 2020


Public Trust Trading Desk

Recent developments regarding potentially effective vaccines for COVID-19 are a positive for future economic growth and suggest that the end of the pandemic could be in sight. Focus is now beginning to shift from the development of these vaccines to manufacturing and distribution, two highly complex tasks that are likely to take many months. In the near term, COVID-19 cases are spiking across the U.S. as we head into late fall, potentially pressuring economic growth in the immediate future.

Despite the increase in COVID-19 cases nationwide, the October nonfarm payroll report beat expectations as 638k jobs were added over the course of the month. The unemployment rate was another bright spot coming in at 6.9%, ahead of consensus estimates of 7.6%. While recent employment metrics are positive and indicate recovery continues, the labor market has a long way to go before we are back to full strength.

Additional fiscal stimulus has been debated since the passing of the CARES Act in March, but progress has been anemic with both sides opting to hold off until after the election. Now that the election is behind us and a split government remains possible, the prospect of a bill being passed in the near term looks bleak. Any comments and additional information around the timing, size, and scope of further fiscal support are likely to be the top focus for market participants moving forward.

As for the November Federal Open Market Committee (FOMC) meeting, it was largely a non-event as the committee voted to hold rates steady and continued to indicate that it is “committed to using its full range of tools to support the U.S. economy in this challenging time, thereby promoting its maximum employment and price stability goals.”

Current Economic Releases

GDP QoQQ3 ’2033.10%
US UnemploymentOct ’206.90%
ISM ManufacturingOct ’2059.30
PPI YoYSept ’20-1.20%
CPI YoYOct ’201.20%
Fed Funds TargetNovember 12, 20200.00% – 0.25%

Treasury Yields


Agency Yields


Commercial Paper (A1/P1)



Source: Bloomberg
Data unaudited. Many factors affect performance including changes in market conditions and interest rates and in response to other economic, political, or financial developments. Investment involves risk, including the possible loss of principal. No assurance can be given that the performance objectives of a given strategy will be achieved. All comments and discussions presented are purely based on opinion and assumptions, not fact. These assumptions may or may not be correct based on foreseen and unforeseen events. The information above is not a recommendation to buy, sell, implement, or change any securities or investment strategy, function, or process. Any financial and/or investment decision should be made only after considerable research, consideration, and involvement with an experienced professional engaged for the specific purpose. Past performance is not an indication of future performance. Any financial and/or investment decision may incur losses.

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