July FOMC Preview and navigating summer markets
This week George Goncalves, MUFG Head of U.S. Macro Strategy, goes over the macro-olympiad of events from central banks to key data releases and concludes by saying that this week could set the tone for the balance of the summer for markets. In terms of the July FOMC meeting, we believe the Fed will need to converge with market expectations in regards to rate cuts. A dovish July FOMC would be consistent with the last 6 prior FOMCs, where rates rally. If that happens it should bring the curve even closer to dis-inverting before they actually cut rates in September. In the meanwhile, there is a lot of time until the September FOMC meeting, where the next focus will NFP, CPI and Jackson Hole in August.