CPI inflation data on the 13th. The Fed rate decision and Powell’s speech on the 14th.
At this point, the market is laying down a hike and it will likely be the last one in this cycle. The Fed could raise by 0.25, 0.5, or 0.75. The first option is extremely positive and the markets will no doubt rally. The 0.75 may be a downgrade. And the CPI data will undoubtedly have an impact on the Fed’s decision on the amount of the increase and the rhetoric itself. There is no doubt that these two events are the key ones this year and they will determine the market sentiment until the next reporting season.
The ideal scenario for the markets would be a stronger-than-expected decline in inflation followed by a 0.25 rate hike. In that case, the shorts would be torn.
