The Real Impact of Rising Rates
What’s in Today’s Report:
- What’s the Real Impact of Rising Rates?
- Chart: 5-Year Inflation Expectations Hit New Highs
Stock futures are modestly lower with EU shares this morning as traders digest the strong post-Fed rally amid hawkish Fed speak and still elevated tensions surrounding Ukraine.
Geopolitically, talks of new sanctions on Russia by the West, including on the energy sector, are acting as a mild headwind on risk assets today.
Economically, the latest U.K. inflation data ran hot with CPI jumping to 6.2% vs. (E) 5.9% in February, a fresh 30-year high.
Today, there is one economic report due out: New Home Sales (E: 810K) but it shouldn’t move markets leaving focus on the Fed as Chair Powell is scheduled to speak at 8:00 a.m. ET. Loretta Mester and Mary Daly will also speak at 10:00 a.m. ET and 11:45 a.m. ET, respectively.
Finally, there is a 20-Year Bond auction at 1:00 p.m. ET that could move Treasury yields.
Bottom line, stocks are showing some signs of exhaustion after a strong one-week rally in the wake of the March Fed meeting, and any additionally hawkish Fed speak or negative news flow surrounding the Ukraine war could see the selling pressure pick up as near term traders book profits on recent gains.
