Making Sense: In Brief
The week ahead for markets and the economy
Phil: Last week, investors had fairly little fresh macro news to digest, so markets continued to process somewhat-softer-than-expected labor market data.
This week, all eyes will be on inflation reports, which increasingly are the data releases that are most impactful for financial markets.
The primary focus will be on the Consumer Price Index inflation report released on Wednesday. Consumer price inflation has been hotter than expected this year, leading markets to pare back expectations for interest rate cuts. Consensus expects the rate of inflation to moderate from last month's firm pace, but any upside surprise would be unwelcome news to both markets and the Fed.
With the Fed now on hold until it sees significant progress in inflation data, markets will be looking for multiple months of better inflation data before expecting an interest rate cut.
Earlier in the week on Tuesday, the Producer Price Index report will be released. Producer price data is important, but markets will likely be looking ahead to the CPI report.
Fresh retail sales data is also released on Wednesday. Consumer spending has remained very firm this year and was the driving force in the first quarter GDP data. The pace of monthly sales growth is expected to slow in this week's release but remain positive.
So items to watch this week. One, CPI. Two, PPI. Three, retail sales.
Making Sense In Brief Outro Slide
Brent Ciliano
CFA | SVP, Chief Investment Officer
Capital Management Group | First Citizens Bank
8510 Colonnade Center Drive | Raleigh, NC 27615
Brent.Ciliano@FirstCitizens.com | 919-716-2650
Phillip Neuhart SVP, Director of Market and Economic Research
Capital Management Group | First Citizens Bank
8510 Colonnade Center Drive | Raleigh, NC 27615
Phillip.Neuhart@FirstCitizens.com | 919-716-2403
Blake Taylor | Market & Economic Research Analyst
Capital Management Group | First Citizens Bank
8510 Colonnade Center Drive | Raleigh, NC 27615
Blake.Taylor@FirstCitizens.com
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