Good morning,
A few months back, somebody asked me, “Why do you put the economic calendar in the MMP, if you don’t recap it or care about economic fundamentals?”.
Now, I wouldn’t say I don’t care about the economic fundamentals, but the point is taken. But I’m just interested in the market’s interpretation of those reports.
And last week was a good example of why we want to know what reports the market is moving in reaction to. CPI, PPI, and retail sales all came out last week, and according to headlines, the inflation data was all hot while retail sales came in soft again. Probably not a great combination.
But the real reason we know it wasn’t great was the market reaction: Stocks went down, bond yields went up.
Adding to upward pressure on rates, metals have been breaking out left and right, and oil joined the party last week. Sounds a bit inflationary?? Sounds kinda like a combination of 2020 and 2022.
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