Will Powell piss in the punch bowl tomorrow? Tough to say although I believe he will still err on the side of inflation .
Considering how fast the price retracted after such weak CPI data with ALL three CPI numbers better than both the previous and forecast, it's very likely Powell is going to continue to take a strong stance against inflation to really make sure it's dead. I mean with so good of CPI numbers, the market should've stayed rallied at 100 points and yet the market quickly retreated from the top and never recovered. What does that indicate? It indicates that the market is not confident that Powell is satisfied with these numbers. Ultimately, the numbers don't matter. What matters is if Powell is happy with these numbers convinced that the inflation is really dead and on its way back to the targeted rate of 2%. As long as he's not happy, the market won't be going up. That's how it is. Seeing how fast the market retracted from the top so quickly, I wouldn't even put 0.75 raise off the table.
Futures say 50 bps. Although...... that's quite a fuse on that firecracker that got formed today. Might be a sell the news event tomorrow. Or will the powers to be give Santa some help? I don't care.....as long as I'm on the train going the right direction.
Actually many times its the opposite. When we pump and dumped we often hit the bid hard then took it up with a vengeance.
Exactly my point. WHY did we dump?? So good of CPI numbers like that, we should be pumping all the way. Why are we dumping still? And why do we still consider the possibility of Powell raising the rates by 75 basis points? With CPI numbers, all three of them so good, why are we not considering the possibility that he might be raising the rate by just 25 basis points? Why isn't the 25 basis points possibility not on the table and not even mentioned by the consensus aka the "Big Boys"? If the Big Boys aren't considering that, that means Powell is not satisfied with these numbers; he's not confident that inflation is really under control and the market reflects that. Unless there are surprises with the basis points of raise, what's going to matter more tomorrow is what Powells says about Fed's future plans going forward. Is he continuing on the QT or easing up or tightening it even further? Is he going to be more sensitive to the data and watch and react or is he still dead set on raising the rates regardless of what the data says? Those are what the market is going to watch for.
I'm reeeaaaal worried about this. I have been busy and haven't been able to pay much attention, but the way the market backpaddled today after the huge early run up was a bad sign. I would bet this is indeed a sell the good news moment coming tomorrow...
You seem awfully desperate to find some negativity about markets. Inflation is dropping rapidly as I suggested would occur months ago. Today's numbers were great. Markets were UP today. The Fed doesn't operate on some weird agenda to appease day traders.
I don't think one has to be desperate to find negativity. By all measures, this CPI print was TWICE as good as last month's because data points within the report that were expected to still be up to flat actually dropped, but unlike last month's print where the markets just climbed the entire day, and had best day in 2 1/2 years, this print did the opposite. I am surprised we managed to finish green, what with the trajectory in early afternoon. So what gives? I could opine and speculate about it being a shitton of profit taking from folks who positioned long yesterday, but there's obviously more to it than that. It's not just tomorrow. We have Retail sales on Thursday, and Friday is quad-witching. Could a lot of this be options repositioning? Who the hell knows.