We are heading toward another eventful week in financial markets. While the week may not bring the same high-stakes economic prints as the previous one, several key developments across policy, politics, and macro trends will keep investors on edge.
On Monday, we had the news that the U.S. bond market is experiencing heightened volatility following Moody’s downgrade of the U.S. credit rating. This unexpected pressure on the Fed could lead Powell to change direction when it comes to interest rate cuts.
The first work day of the week will also have important repercussions on stablecoin regulations. By 8:35 PM EST, the GENIUS Act will have another go at the Senate, and the result could impact the future of stablecoin issuance in the States.
British Consumer Prices in Check
By Wednesday, May 21, the Office for National Statistics will release the data regarding consumer prices in the United Kingdom. This report will be closely watched as investors and policymakers assess whether inflationary pressures are rebounding or continuing their gradual decline. With the previous print at 2.6% and forecasts projecting 3.3%, expectations suggest a potential uptick in consumer price growth.
Housing and Labor Market Updates in The U.S.
On Thursday, investors will be watching the latest jobless claims reports, as both initial and continuing claims provide insight into employment trends. A sharp increase could signal weakening job stability, while a decline would suggest a resilient labor market despite recent economic uncertainty.
Also on the radar is the S&P Global Manufacturing PMI, an important gauge of economic activity. If factory output shows strength, it could boost market confidence. This data is especially relevant as it will allow us to get a sense of whether the ongoing trade war is affecting American manufacturing.
Meanwhile, the housing market takes center stage with existing home sales data on Thursday, followed by new home sales updates on Friday. With mortgage rates still historically high, demand dynamics remain uncertain. Sales trends in both new and existing homes will help reveal whether buyers are adjusting or if affordability challenges continue to weigh on the market.
Markets will be digesting these reports carefully, as they could shape expectations for Federal Reserve policy, inflation trends, and overall economic momentum heading into the next FOMC meeting on June 18.
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