FXStreet – The last week released minutes for the FOMC meeting has the expectations of an increase in interest rates on the 14. June strengthened, said Peter Peter rose string, Swissquote market analyst.
Even if the second estimate for GDP growth in the 1. Quarter is down 1.2% higher, the number of still subdued. Incoming weak data (especially disappointing inflation data) have lowered our expectations of a faster economic momentum.
The inflation and labor data this week and, especially, wage growth will be decisive for the evaluation of the next actions of the Fed. The last two reports on consumer price inflation, however, stressed a continuing weakness in core inflation pressure. This lack of price growth could bring the Federal Reserve back on the sidelines, and Janet Yellen force, to streamline the current tightening cycle. The PCE Deflator for April will be released on Tuesday and is expected to continue to fall to 1.5% year on year, yoy. 1.6% a month ago. A weaker result could jeopardize the speed of interest rate normalisation over the June session, seriously.
** FXStreet News Editorial, FXStreet**