Caution! This week these data could stir up huge waves in the market
The Federal Reserve is about to meet to decide on interest rates, and the market is extremely tense. Powell and his team are having a tough time this week, facing significant political pressure, fluctuating trade policies, and chaotic economic data. This meeting is definitely going to be interesting.
Even more stimulating, the US is set to release a bunch of important data this week: GDP, employment reports, and the inflation data that the Federal Reserve is most concerned about. Although everyone currently guesses that the Federal Reserve will not change interest rates, these data could flip the situation at any moment.
Let’s discuss a few key predictions:
First, the GDP growth rate for the second quarter to be announced this Wednesday is predicted by experts to be 2.4%. This is much better than the negative growth of 0.5% in the first quarter, but it should be noted that this is mainly supported by a reduction in the trade deficit; the actual economic situation may not be as good as it seems.
Second, the July employment data to be released on Friday is expected to show that companies are not hiring as aggressively. The June data was inflated by temporary hiring in the education sector, so the number of new jobs this month is sure to decrease, and the unemployment rate may rise to 4.2%.
Third, the inflation data for June is expected to rise a bit faster, indicating that the price pressure from tariffs is being passed on to the public, and prices won't be coming down anytime soon.
With so much important data coming out at once, each one could potentially lead the Federal Reserve to change its mind. Right now, everyone is saying that interest rates will remain unchanged, but when the data actually comes out, the Federal Reserve might have to rethink its position.
