Global Market – Recession in US in later part of 2023 – US Economic data & Fed minutes
This week we will discuss US economic data and US Fed meeting minutes of 22-Mar-23 meeting and key economic data. We will also discuss how market is factoring in next move by US Fed on 3-May-23 high interest rate remains key risk to economy and banking system.
US Economic data – released this week 10-Apr-23 to 14-Apr-23
Core CPI & Core PPI remains key worry for US Fed as service inflation which is normally connected to wages remains higher and it would take few more quarter for US Fed’s long-term target of 2% inflation. As on 15-Apr-23, Fed fund rate monitor tool indicate 78% probability of 25-bps rate hike and yes, our view is contradictory to current indicator.
US Fed meeting minutes of 21 – 22 March 2023 – released on 12-Apr-23
Spillovers from the banking crisis that rocked the United States in March will push the country into a mild recession later this year, according to the minutes of the Federal Reserve Open Market Committee’s March meeting released on Wednesday.
Equichain Wealth Advisors: Market View & Opinion
We see inflation and economic activity will continue to remain soft, corporate earnings have started and will provide further cues. Major US Banks – JP Morgan, Wells Fargo & Co, Black Rock, CITI Group & PNC Financial came out with their results and most of them beat market expectation yet US market was down as hope of pause by US Fed declines.
We continue to believe, US Fed might pause on 3-May-23 meeting near term data shows uncertainty and we continue to believe US Fed will focus on data rather than earnings, which continues declining trend.