TAG Industrial Watch: June 22, 2024

For those looking forward to rate cuts by the Federal Reserve, last week brought a lot of positive news. Month-over-month, the Consumer Price Index was flat, wholesale prices fell 0.2%, and import prices dropped 0.4% (CNN, CNBC, & Reuters). Although these reports seem encouraging for the near future, America’s long-term outlook on price inflation likely has not changed because of the fundamental problem that drives prices higher. When it comes to the national debt, there are about 35 trillion reasons and counting that explain why inflation will likely be problematic for years to come. Washington’s historical inability to balance its budget means that once it burns through the remaining $723 billion it raised from tax season and the $389 billion still held at the Fed (largely by Money Market Funds), the government will quickly run out of lenders (FRED). It’s possible that we could witness a repeat of the 2019 Repo Crisis when interest rates spiked, which caused the Fed to jump back into the Treasury market, buying up $382 billion in bonds by inflating the money supply, all before the pandemic started. Industrial investors who are waiting on the sidelines for lower rates should consider taking advantage of the current lending environment. The bond market is relatively stable now but it could only be a matter of time before volatility makes a comeback.

I N D U S T R I A L   N E W S

Inflation Slowed In May, Hinting At Welcome Relief For Consumers
CNN Business – June 12, 2024
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Wholesale Prices Unexpectedly Fell 0.2% In May
CNBC – June 13, 2024
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US Import Prices Fall, Consumer Sentiment Slides
Reuters – June 14, 2024
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April Sales Weakest So Far This Year
GlobeSt.com – June 11, 2024
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The Case For Last-Mile Facilities
Commercial Property Executive – June 4, 2024
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R E G I O N A L   N E W S

Illinois Announces $41B Infrastructure Program
Connect CRE – June 19, 2024
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Prologis Selling 5M SF Twin Cities Portfolio To EQT Exeter
Bisnow – May 29, 2024
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Venture One Leases 445 KSF At Chicago Industrial Asset
Commercial Property Executive – June 18, 2024
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Industrial’s Focus May Be Shifting Toward The Heartland
GlobeSt.com – June 11, 2024
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Crow Holdings Sees Logistics Promise
In East Dallas, Begins New Hub
CoStar – May 29, 2024
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