Making Sense: In Brief

The week ahead for markets and the economy

Phil: Last week, markets digested the Federal Reserve's decision to raise the Fed funds rate by 0.25 percent amid steady news flow out of the financial sector.

Looking to the week ahead, investors will likely remain focused on the global financial sector. Not to mention, markets will likely continue to price the implications of fresh guidance from last week's FOMC meeting.

The February personal income and spending report comes out on Friday. Both personal income and spending are expected to have grown in February, just as they did in January. The US consumer remains critical to the economic outlook. This report also contains the Fed's preferred inflation measure, the PCE deflator. Will this measure show moderation in the pace of consumer inflation like the consumer price index did earlier this month? Consensus believes the pace of month-on-month inflation will slow.

Earlier in the week, keep an eye on January's Case-Shiller home price index on Tuesday. The pace of year-over-year home price appreciation peaked last March at 20.8 percent and was 5.8 percent in the most recent data for December. While the pace of home price appreciation will likely continue to moderate, the inventory of homes remains tight throughout much of the country, which should provide some support to prices.

Also on Tuesday, the Conference Board's measure of consumer confidence is released. With disruptions in the banking sector having had an impact on consumer confidence, economists believe sentiment will weaken modestly.

So items to watch. One, the financial sector. Two, personal income and spending. Three, home prices along with consumer confidence.

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

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