February 16, 2022
Good morning,
The latest retail sales numbers are due before this morning’s market open. Minutes from the Fed’s recent meeting will be released this afternoon. Without the threat of an act of war at the Ukrainian border, the sales numbers and minutes would be important data inputs to the market’s discovery mechanism as it continuously gauges the rise of inflation and the speed of the Fed’s reaction to it. However, despite the Kremlin’s words of withdrawal yesterday, according to the Sec General of the UN this morning, there are no visible signs of withdrawal on the ground at the border at this time.
The VIX index is riding high at 25. The uncertainty around Russia’s intentions grinds the market’s discovery process to a halt and sucks up all the attention from investors. I don’t have anything to add to the view laid out in Monday’s Morning Note, except that it’s on hold now until Russia plays its hand.
Be well,
Mike