Why the 7% CPI Print Wasn’t Incrementally Hawkish
What’s in Today’s Report:
- What the 7% CPI Print Wasn’t Incrementally Hawkish
- EIA Analysis and Energy Market Update
Futures are little changed following a generally quiet night of news.
Vice-Chair Brainard’s prepared remarks for today’s testimony were released after the close and she said fighting inflation was the Fed’s “most important task” largely echoing Powell’s commentary from Tuesday.
Senator Manchin called the 7% CPI print “very troubling,” further reducing the chances of Build Back Better passing.
Today focus will be on Brainard’s testimony, but as long as she doesn’t imply sooner than expected balance sheet reduction, the market shouldn’t take her comments too hawkishly. Other potential market events today include, in order of importance: PPI (E: 0.4%, 9.8%), Jobless Claims (E: 205K) and three Fed speakers: Harker (8:00 a.m. ET), Barkin (12:00 p.m. ET) and Evans (1:00 p.m. ET).
With stocks not too far from recent highs, they will again be sensitive to more hawkish rhetoric, so if Brainard and her Fed officials are hawkish, and we get a stronger than expected PPI report, don’t be surprised if that puts a mild headwind on stocks today.
