FOMC Meeting Preview
What’s in Today’s Report:
- FOMC Preview
- Empire State Manufacturing Survey & Industrial Production Takeaways
Futures are flat this morning as traders continue to digest the U.S.-Iran peace deal news from the weekend and a 25 bp rate hike from the BOJ to the highest policy rate since 1995 (1%) amid disappointing global economic data.
Economically, Chinese Fixed Asset Investment fell -4.1% vs. (E) -2.3% y/y and Retail Sales dropped -0.6% vs. (E) -0.3% while the German ZEW Survey headline fell to -81.0 vs. (E) -77.5.
Looking into today’s session, there are two economic reports to watch in the U.S. between Housing Starts (1.430M) and Import/Export Prices (E: 1.3% m/m, 2.0% m/m). However, with the FOMC meeting getting underway in Washington today, the data should not materially impact markets.
Aside from the data, the Treasury will hold a 6-Week Bill auction at 11:30 a.m. ET and a 20-Yr Bond auction at 1:00 p.m. ET.
Given the Fed has been in their “blackout period” for the last two weeks, any signs of overly strong (dovish) or materially weak (hawkish) demand in the Treasury auctions could spill over and impact stocks, but otherwise today should be a relatively quiet day with a sense of “Fed paralysis” likely to begin to grip markets ahead of Warsh’s first Fed decision due tomorrow.
