This afternoon’s US data was a relatively mixed bag, with retail sales rebounding in solid enough fashion from a sub-par January.
Tthough a surge in producer prices, with YoY headline PPI hitting its highest level since September, provided a further reminder that the economy remains far from being ‘out of the woods’ in terms of the battle to squeeze inflation back towards the FOMC’s target.
While Treasuries have sold-off, the dollar rallied, and equities slipped since the data dropped, these moves are unlikely to be prolonged.
Particularly as the data is highly unlikely to move the needle in terms of the FOMC outlook, with the first 25bp cut still likely to come in June.
