- After a quick spike in prices, broad equities have taken a breather while volatility has returned to sub-15. I expect a return to appreciating risk assets over the coming weeks.
- CPI and PPI data arrived last week in line with expectations and was accompanied by slightly stronger employment data. Both releases strengthen the case that the Fed has achieved a no landing scenario.
- Next week will be relatively mundane in terms of relevant data. I will keep an eye out for continued strength in jobless claims and anchored inflation expectations.
- The dollar has been rising alongside long dated treasuries in what appears to be an anticipatory “resilient US economy” trade. I feel this trade has run too quickly too soon and will back off, providing further tailwinds to risk assets.
