It seems almost daily there is either new economic data or a Fed official shooting their mouth off trying to prove how ‘hawkish’ they are now after totally missing the boat for a year. Yesterday the 10 year treasury closed at 2.99% after trading as high as 3.17% on Monday. Today the 10 year treasury is down again at 2.92%.
Today we wait on the release of the April Consumer Price Index. It seems that the new theme from all the talking heads is ‘inflation has peaked’—which has contributed to falling interest rates. Obviously if we get an upside surprise to inflation today interest rates are going to spike. The expectation today is for year over year inflation of 8.1% versus 8.6% last month. On a monthly basis a .2% increase from last month is expected.
Buckle your seat belts–a significant miss on the forecast–either direction — may mean a big ride in markets today.