To sum up last week it was all about The Fed, Treasury Yields and February Winter Weather


Treasury yields, particularly for the 10-year, continued to climb during week hitting growth equities - the Nasdaq and Russell 2000 - in the process. 
Comments from neither European Central Bank President Christine Laggard nor the Fed’s dovish post FOMC meeting comments that included not raising interest rates until 2024 and continuing its $120 billion per month in asset purchases did the trick. 
The Fed’s policy statement revealed an unanimous decision to not change the Fed funds rate and there was no change in the median estimate that the fed funds rate would remain unchanged through 2023. 
In his press conference, Fed Chair Powell said it wouldn't be time to start talking about tapering asset purchases until the Fed sees substantial further progress in meeting its employment and inflation goals -- "actual progress" and not "forecastprogress."  
He emphasized that the FOMC is not considering tapering, raising rates or changing policy for the time being.
But the day after that, the 10-year Treasury resumed its upward climb, flirting  with 1.76% before pulling back but still finishing the day higher. 


Part of the reason for that was found in the Philly Fed's March survey showed the highest measure of prices paid in more than four decades.

Comments from Nike (NKE) made during the company quarterly earnings conference call late this week also point to short-term inflation drivers in the form of supply chain challenges, including global container shortages and U.S. port congestion. 

Sticking with the pandemic, President Biden will achieve his goal of delivering 100 million vaccination shots in his first 100 days this week, less than 60 days into this presidency with the pace of shots hitting an average of nearly 2.5 million per day.

The Bottom Line is the Fed is likely to let inflation run hotter than usual to get employment closer to historical norms. This could mean the run up in Treasuries isn’t over yet, and investors we will have to watch the data to see if Powell or the market is correct when it comes to inflation and what that means for the federal funds rate,

This Week: 


Predominantly housing but also Personal Income & Spending 
Housing will likely see a hit from the February weather but we’ll want to watch the YoY comparisons. 
Personal Income & Spending - likely to see a MoM decline as the impact of the December spending checks were really felt in January


Starting to hear more of the follow up for Biden’s economic agenda now that the $1.9 trillion relief bill is underway

Also following the first face-to-face meeting between US and China officials since President Biden's election, what’s next for US-China relations? Initial indications are the meetings were filled with bickering…. resembling a grade school lunch room in our opinion

Listen to Advisorpedia's Week Ahead ... Powered by Tematica Research.

The must listen podcast of your Monday.

Resources: Tematica Research | Chris Versace | Lenore Hawkins

Related: The Week Ahead: Are We Going To See a Repeat of the Post-Spanish Flu Roaring 20s?