The Fed Takes Center Stage but a Hike is Already Priced In
The Fed takes center stage this week, allowing most of the data to take a backseat to this event. Market participants have fully baked a 25-basis point rate into the capital markets an await the forecast revisions to help determine how many hikes the markets should expect in 2017. Growth and inflation expectations will be edged higher, but the FOMC will not likely inject much into the Trump lead rally as
Data of note will take place after the Fed announcement beginning with consumer inflation on Thursday. The CPI is expected to show an increase of 0.2% in November, with the core edging higher by 0.2% to push the year over year number to 2.1%. Philly Fed and the Empire manufacturing index will give investors some idea of sentiment is improving at the factory level. The Philly Fed index is expected to move higher to 8.1 from 7.6, and the Empire State figures is expected to move to 2.4 in December from 1.5 in November.
jobless claims are expected to revise the lows moving back down to 250K whiles the the NAHB housing market index is expected to hold steady at 63 in December. Housing starts anchor the week with starts declining by approximately 6.0% to a 1,240k unit pace in November after the 25.5% surge to 1,323k in October.
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