The CPI in the USA The report was positive news for bulls because it suggested the FOMC could start to ease off the brakes in May (69% likelihood of another increase). Some market participants believe one more 25bp and they will be done, others remain Hawkish and that moving CORE CPI & CPE from the 5% to the 3-2% range will prove problematic and this could mean hikes in May and June too.
Minutes from the FOMC showed considerable discussions over the banking turmoil, as indicated in Chair Powell’s press conference. The “banking sector” was the literally the lead paragraph of the report and was mentioned 24 times overall, compared to zero in February. The outlooks showed some general softening, however. “increased the already-high level of uncertainty associated with the outlooks on economic activity.” However, ultimately “all” Participants supported the 25 bp rate rise. A Moderate recession FOMC.
The Bank of Canada Attained its target rate of 4.50%, The March tightening of 25 bp in January was, as expected and unchanged. But it was a “hawkish” pause as inflation and economic activity have not really evolved as expected. CAD The news brought you great results.
Yesterday’s news flow was dominated by volatility. USD Diving and remains…
