Weighing the Week Ahead: Will Strong Economic Data Send Interest Rates Higher?

The economic calendar is huge, including the most important monthly data and plenty of earnings reports. With a Fed meeting on the calendar and Tuesday’s decline attributed to the ten-year note touching 3%, the punditry will be asking:

Will economic data drive interest rates higher?

Last Week Recap

In my last edition of WTWA I predicted a renewed effort to find fresh fears. That was right on target. Many of the usual suspects did exactly as expected, moving out the timeline to dismiss current news to find more worrisome subjects.

I felt that the issues last week were especially important, and I appreciate the many readers who found the post to be helpful. Meanwhile, my meetings and travels involved conversations with many intelligent investors. Many of them are frightened by the increase in volatility, instead of embracing the opportunities presented. This fear is not grounded in any data, but the perception is quite real and affecting behavior.

The Story in One Chart

I always start my personal review of the week by looking at a great chart. I especially like the version updated each week by Jill Mislinski. She includes a lot of valuable information in a single visual. The full post has even more charts and analysis, so check it out.

While the market was unchanged for the week, there was plenty of action along the way! Despite the attention-grabbing move on Tuesday, the trading range was only about 2.8%. I summarize actual and implied volatility each week in our Indicator Snapshot section below.

The News

Each week I break down events into good and bad. For our purposes, “good” has two components. The news must be market friendly and better than expectations. I avoid using my personal preferences in evaluating news – and you should, too!

Feel free to add items that I have missed. Please keep in mind that we are looking for current news, especially from the last week or so. WTWA is not about long-term concerns like debt. These are important, of course, but not our weekly subject unless there has been some major change.