June 12, 2023
Good morning,
Last week had little economic data, muzzled Fed members in their quiet period, and little movement in the markets (S&P 500 +0.38% for the week). In contrast, this week is fairly huge though traders are approaching it warily (Futures +0.25% pre-market). They are bracing for May’s U.S. CPI (Consumer Price Index), a key inflation measure, and monetary announcements not just from our Fed but the European Central Bank (ECB) and Bank of Japan (BOJ) as well.
I suppose a little caution is understandable, but it is not clear that this week’s events will prove to be decisive. It is almost universally expected that the Fed will hold off on hiking rates on Wednesday with no guarantee about what comes next, even with a fresh update to the Fed’s dot plot (their views on future rate changes).
Steady as she goes then. See you Wednesday.
Be well,
Mike