March 1, 2017
The big 3 tenths jump to the 1.9 percent rate for the PCE price index puts the Fed on the hot seat for a rate hike at the mid-month FOMC. Though there are offsets including less heat for the core rate (which excludes rising energy prices) and also general softness for both consumer spending and income. Showing a lot of heat of its own is the ISM report where readings have built steam to the best levels of the recovery and which point to coming strength for the government's factory data which, in contrast, have yet to show any life.
Rate hike or not, the stock market is on fire and got another lift from last night's Congressional address by President Trump who focused once again on stimulative economic policies. The Dow posted a fractional loss yesterday to end a 12-session winning streak but may have opened a new streak based on today's 1.5 percent surge to 21,115 and a new record. Interest rates were surprisingly little changed despite the surge into the stock market though the dollar index showed strength, up 0.4 percent to 101.76.