Wednesday, October 14
·Afternoon
Fed Beige Book
The Fed's read on the regional economy, hours after CPI.
See the whole week ›Two weeks ago, an October rate hike was the market's base case. At the end of September, prediction markets priced it near 70 percent. This morning they price it around 16.
Nothing scheduled
Nothing scheduled
Nothing scheduled
Nothing scheduled
Nothing scheduled
It took one week of softer data and a few Fed officials saying they could wait. Then the September jobs report sealed it: 29,000 new jobs, against forecasts of roughly 84,000 to 90,000.
What I find interesting is which half of the story did the work. The hike got priced out on the labor side of the Fed's mandate. This week the inflation side gets its turn.
The CPI headline is expected to jump, but everyone knows that already. It is in the price. So the number that gets screenshotted at 8:30 is probably the least informative one in the report.
The unlock calendar is light, so token supply is not this week's story.
Markets rarely get hurt by the number everyone is watching. They get hurt by the conclusion they reached quickly and stopped questioning.
October came off the table in about a week.
Wednesday is when we find out whether it should have.
The Fed's read on the regional economy, hours after CPI.
The headline is expected at 3.6–3.7%, up from 3.4%, mostly on gasoline. Core, around 0.2% m/m, is the line that matters.
September CPI's headline is expected to jump: forecasts sit around 3.6 to 3.7 percent, up from 3.4, mostly on the back of gasoline.
Everyone knows that already. It is in the price. So the number that gets screenshotted at 8:30 is probably the least informative one in the report.
Core is the line that matters, and expectations cluster around 0.2% on the month.
The Fed's read on the regional economy, hours after CPI.
A read on whether consumers are still spending through higher fuel prices.