FOMC day is upon us, come back to this page in the 3pm hour for a recap. After rising to new cycle highs (highest levels since 2007), U.S. yields are down a few bps to start the year, the 2Y is down 4bps to 5.07% and the 10Y is down 2bps to 4.34%. After Canada's inflation came in hot yesterday, this morning we have a UK inflation slowing to the lowest level in the last year and change, coming in at 6.7% YoY (it's still a 6 handle...but I guess that's better than 7). We also had German PPI falling 12.6% YoY. Oil falling some on the data. Of course the topic of the day is the Fed decision at 2pm and Powell presser at 230pm. The market is pricing a Fed on pause, so all the focus will be on the tone of the message as participants look for clues as to whether another hike is expected this year and the path forward.
XTOD: "Supply-side constraints exemplified by the autoworkers’ strike & rise in oil prices will cast a hawkish shadow over the FOMC meeting that starts today. Powell is likely to embrace some version of the higher-for-longer policy that is increasingly being priced in:" Citi analysts
XTOD: A recent study of the decline of happiness in the US since the 1990s found that "arithmetically, most of the overall downturn is attributable to the decline in marriage."
XTOD: BIDEN SAYS DEPLETING SPR IS ON TABLE: WSJ The Strategic Petroleum Reserve (SPR) was created in the 1970s to prevent this from happening again (gas lines that created havoc in the US economy).
XTOD: Another sign of a tight US labor market: Amazon is planning to hire 250,000 holiday workers to pack and store warehouse items, up from 150,000 last year, & is offering more pay. While this reflects a shift to online shopping, it speaks to economic strength
XTOD: We asked investors & economists what is behind the ~50bp rise in real longer-term yields in the past 2m, mostly they attribute it to higher for longer Fed policy, good data and large deficits
XTOD: To the ‘BlackRock and Vanguard own every company and are the secret puppet masters of the universe’ crowd, please Google search the meaning of ‘index funds’ and then never tweet again. Sincerely, Everyone else
XTOD: We all have two lives, and the second begins when we realize we only have one"
https://x.com/lisaabramowicz1/status/1704088188107546882?s=20
https://x.com/DKThomp/status/1704128395758477676?s=20
https://x.com/lisaabramowicz1/status/1704215768550776927?s=20
https://x.com/hmacbe/status/1704111926522093902?s=20
https://x.com/jc_econ/status/1704189782262235580?s=20
https://x.com/thelykeion/status/1704051758962495530?s=20
https://x.com/mnicoletos/status/1704078829499633874?s=20
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