Thursday's Market Minute: Today's Driving Forces Are Fed Chair Jerome Powell And The CPI

As we head into day two of Jerome Powell’s testimony on Capitol Hill, the focus will shift from Fed dovishness and expectations for a rate cut later this month to inflation figures due out today and tomorrow.

Yesterday, Powell in comments to the House stated, “uncertainties around trade tensions and concerns about the strength of the global economy continue to weigh on the U.S. outlook.” His comments helped lift the Nasdaq and the S&P 500 to new all-time highs and rates to recent lows as he hinted at a rate cut to come "in the near term." But heads-up, traders: Consumer Price Index is one of the more closely watched data points and a key metric in the Fed’s decision making process.

CPI measures the change in the average price level of a fixed basket of goods and services purchased by consumers, and it’s headed our way at 8:30AM ET. Tomorrow, we’ll get some insight about inflationary pressures on the producers’ side of the equation. Expectations are for the data to remain mostly muted. However, with expectations so heavily weighted to one side, this number could move markets if we get a hot number today and CPI levels are above expected.

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