By Benjamin Picton, senior strategist at Rabobank
Gift Wrapped
Today is the big day. I’m not talking about the release of the US PCE deflator or the OPEC+ meeting (though both are on the calendar and will be a big deal), but the annual event that is the Spotify Wrapped summary and associated ubiquitous social media posts. Consequently, we can look forward to learning that we spent the whole year listening to the same 3 artists as last year, which might just be the definitive symptom of the cruel descent into middle age.
While millennials are poised to again discover that TayTay was number 1, central bankers are equally surprised to learn that the imminent trajectory for policy rates is down (as it largely has been since Volcker). We had more Fed speak overnight from Raphael Bostic (a dove), who said that he is increasingly confident that inflation’s downward trajectory will continue. Conversely, Thomas Barkin adopted Bowman’s wrongthink of the day before by saying that the Fed needs to keep the option of further hikes on the table, and noted hawk Loretta Mester hedged her bets by suggesting the Fed has the luxury of waiting for more data.
Predictably, markets chose to…
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