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Interest rates across the yield curve moved higher last week as investors started to question whether the recent bond market rally has come too far, too fast.1 The equity rally also took a pause with the S&P 500’s nine-week winning streak coming to an end.2 Friday’s market activity was topsy-turvy as the stronger-than-expected employment report was quickly followed up by a weaker December Institute for Supply Management (ISM) service report.3
This week’s economic data includes numerous inflation measures beginning with today’s New York Federal Reserve’s (Fed) one-year inflation expectations.4 The consumer price index (CPI) report will be released on Thursday followed by the producer price index (PPI) on Friday.5 Fed policymakers will be looking for continued improvement in the inflation data to validate their “dovish” shift.
Sources:
1,2,3CNBC – S&P 500 closes slightly higher Friday, but major averages end 9-week win streak; 1/5/24
4Investing.com – U.S. NY Fed 1-Year Consumer Inflation Expectations; January 2024
5MarketWatch – U.S. Economic Calendar; as of 1/8/24
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