Fed decision drops Wednesday 2pm ET. CME FedWatch says ~90% chance of 25bp hike, ~10% hold.
The setup is messy:
• Inflation's still not cooperating (CPI 3.4%, PPI 5.4%)
• Warsh wants hard 2% target
• Treasury buying bonds to suppress yields
• White House pushing for "lowest rates in the world"
Fed and Treasury literally working against each other right now. That's your tape going into Wednesday.
The setup is messy:
• Inflation's still not cooperating (CPI 3.4%, PPI 5.4%)
• Warsh wants hard 2% target
• Treasury buying bonds to suppress yields
• White House pushing for "lowest rates in the world"
Fed and Treasury literally working against each other right now. That's your tape going into Wednesday.
