I hope everyone is enjoying their weekend. CPI, PPI and Retail sales all missed expectations. That seemingly should have been a win for the dovish contingency on the Fed. The issue is that none of the data were actually weak, so they will not placate the hawkish contingency. That likely leaves us at a stalemate for September hiking decisions as of now, which means more passive easing and ultimately more hikes needed down the line. The bond market may have started to sniff this out by the end of the week was saying enough is enough.
We do not have a significant amount of data this week. Monday has empire manufacturing. Tuesday has import prices, housing starts and building permits and industrial production. Thursday has Philly Fed on top of claims. Friday has S&P PMIs.
Let’s dig in.