U.S. Financial Market Update: The Week Ahead

Jay and Janet on the Hill

Federal Reserve Chair Jerome Powell will deliver his semiannual testimony to the Senate Banking Committeetomorrow, while Treasury Secretary Janet Yellen is scheduled to testify before the House Financial Services Committee (HFSC) on the international financial system. On Wednesday, Powell will continue his twice-a-year monetary policy report before the HFSC. Based on recent comments, the Fed Chair will likely strike a dovish tone by calling out the progress made in quelling inflation in recent quarters. Yellen is expected to field pointed questions by GOP lawmakers led by HFSC Chair Patrick McHenry on the trajectory of the U.S. deficit. 

Three straight months of soft-ish inflation? 

Thursday morning, Bureau of Labor Statistics data is expected to show the headline consumer price index (CPI) climbed 0.1% in June after readings of 0.0% in May and 0.3% in April. If the 0.1% consensus estimate proves accurate, year-overyear CPI would drop to 3.1% from 3.3% in May, tied for the lowest reading since March 2021. Core CPI, which excludes food and energy, is projected to have been 0.2% last month, only a bit higher than the headline reading and good enough to keep the annual reading at a three-year low of 3.4%. CPI data that meets expectations or modestly surprises to the downside for a third straight month will likely be met with enthusiasm by the stock market.

Read the full   US Financial Market Update The Week Ahead July 8, 2024