The Fed’s rate hike was its 10th since March of 2022. Seeking to rein in high inflation, the central bank has increased the key federal-funds rate from next to nothing to between 5% and 5.25% over that span.
Repo
Harley-Davidson last week said its credit loss rate rose to 3.2% in the first quarter, up from its typical rate of about 2%.
Active ETFs
Active funds still make up a sliver of the roughly $7 trillion ETF market—less than 6% of total assets—but have attracted about 30% of the total flows to ETFs so far this year. That follows a banner year for active ETFs in 2022, when they gathered roughly 14% of total flows. Analysts say the outsize flows reflect greater interest in active management amid turbulent markets as well as the ease with which they allow investors to more easily trade specific strategies.
FRC JPM
First Republic Bank was seized and sold to JPMorgan. The deal will see JPMorgan take on all of First Republic’s $103.9 billion in deposits and buy most of its $229.1 billion in assets.
San Fran Vacancy
Nearly 30% of San Francisco’s office space is vacant, which is more than seven times the rate before the pandemic hit, and the biggest increase of any major U.S. city.
Small Cities
Small cities in the Midwest topped The Emerging Housing Markets Index in the first quarter, a sign that buyer demand for affordable homes remains robust even as activity in the broader market slows.
Office Buildings
The U.S. office vacancy rate reached a milestone in the first quarter when it rose to 12.9%, exceeding the peak vacancy rate during the 2008 financial crisis, with office-building prices down 25% since early 2022.
Bankruptcies
In March, 42,368 bankruptcy petitions were filed nationwide, up 33% from 31,898 in February and up 17% from a year ago. Commercial filings jumped 24% to 2,305 in March compared with a year ago, and 548 of those were Chapter 11 bankruptcy filings, up 79% from a year ago.
Insurers Pull Back
15% of insurers with commercial real-estate lending businesses are planning to shrink their activity this year. That's more than three times as many in the same survey last year.
New Construction
After three consecutive month-over-month increases, the overall number of U.S. rooms in construction fell slightly in March. Among the chain scale segments, luxury shows the highest number of rooms as a percentage of existing supply at 5.2%.