Weekly Market Update

ANOTHER INTEREST RATE HIKE?

Thursday, October 12, 2017

The Federal Open Market Committee released minutes from its September meeting on Wednesday, revealing continued disagreement among Federal Reserve officials about an additional interest rate hike this year. Their primary concern is whether U.S. inflation can increase to their inflation target of 2%. The inflation rate remains persistently low, but some argue that continued low unemployment may increase wage demands and cause inflation to spike, requiring rapid rate changes. In the meantime, the federal funds rate is unchanged, and the bond and stock markets were relatively stable following the release of the minutes.

In Other News

  • According to the U.S Department of Education's National Center for Education Statistics, those who entered college in 2003-2004 are taking longer to pay off their student loans than those who started in 1995-1996. Rising college tuition, the Great Recession, and federal policy changes may have all contributed to the trend.
  • UNC Chapel Hill plans to raise over $4 billion by 2022, the second-largest current campaign among public institutions, notable for its shift toward private funding sources. The money will be used to fund scholarships, revamp teaching methods, build new science facilities, and support entrepreneurship programs.
  • NCAA President, Mark Emmert, announced the formation of a commission to change the way college basketball operates and to address fraudulence in the system.
  • Boston University and Wheelock College will merge next summer. The two institutions' schools of education will combine to form the new Wheelock College of Education & Human Development.
  • University of Oregon plans to spend 30% more on recruiting this year to expand enrollment, primarily by attracting out-of-state students.
  • The A. James & Alice B. Clark Foundation has made a $219 million gift to the University of Maryland, the largest private donation to the University to date. The fund will be used to support more need-based scholarships as well as scholarships for undergraduate engineering students.

Rating Agency Update

  • Moody's assigned A2 to Florida Gulf Coast University Financing Corporation's Series 2017A and Series 2017B Capital Improvement Refunding Revenue Bonds. The outlook is stable.
  • Moody's affirmed its A1 rating on Barnard College. The outlook is revised to stable from positive.
  • Moody's assigned Aa2 to State University of Iowa's Series 2017 Athletic Facilities Revenue Bonds and Series 2017A Athletic Facilities Revenue Refunding Bonds. The outlook is stable.
  • S&P affirmed its A rating on Florence-Darlington Technical College's Series 2014 Special-Fee Revenue Refunding Bonds. The outlook was revised to negative from stable.
  • S&P assigned BBB to Saint Francis University's Series 2017 Revenue Refunding Bonds. The outlook is stable.
  • S&P assigned A- to University of Scranton's Series 2017 Revenue Bonds. The outlook is stable.
  • S&P affirmed its A rating on Drexel University. The outlook was revised to negative from stable.