Interest Rate Commentary: Early Wednesday

  • Reopenings have been under way in the US for 2-3 weeks – at various speeds – but press reports continue to analyze cases using an April approach. That is, they still label increased cases as “spikes” or “flares” vs previous levels without taking the increased number of tests into account. In less than two weeks, the number of daily tests has risen more than a third. Thankfully, the positive test rate has floored above 5.0% nationally.
  • There isn’t an exact way to adjust case levels for test levels, but any increase in cases needs to be statistically valid given a major change in the data pool. In comparing individual states, the starting point is also relevant. Since April, percentage increases in “low impact” states have been consistently higher than the states that were hit the hardest. Reopening has not changed that pattern, so far. Much of the previous differences were related to higher test rates in high impact regions.
  • In other good news, the number of states carrying FHN’s high impact status is the lowest it has been since March: 9 plus the District of Columbia. More on all these topics an article scheduled for The Weekly Report this Friday.

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