Overview: Wed, March 01

Daily Agenda

Time Indicator/Event Comment
07:00MBA mortgage prch. indexLittle change expected in latest week
08:30Personal consumptionModerate gain in nominal terms but real spending flat
09:45Markit mfg PMI (final)Another solid reading
10:00ISM factory reportHighest level in over two years in February
10:00Construction spendingSolid increase expected in January
13:00Kaplan (FOMC voter)On local and national issues
14:00Beige bookRegional Fed surveys suggest manufacturing is strong, but services are moderate
Dom & imp. auto salesPartial reversal of January decline
Reserve maint. period ends

US Economy

  • Economic Indicator Preview for Wednesday, March 1, 2017

    Today’s economic data are likely to have a generally strong tone.  The price data in this morning’s PCE report should be encouraging enough to keep the Fed on track for a rate hike on March 15, but probably won’t create any additional sense of urgency.  The ISM manufacturing index seems likely to rise to another new two-year high.  February auto sales should recover from January’s temporary dip, and January construction spending is expected to post a solid gain.

Federal Reserve and the Overnight Market

This Week's MMO

  • MMO for February 27, 2017

    Fed guidance and market pricing still seem far apart with respect to the March meeting.  The Fed would probably be more comfortable with prospect of a March tightening if the market were pricing in a somewhat higher probability than it is at present, but the FOMC won’t need to see the same level of market certainty that it achieved leading up to the first two rate hikes.  Separately, the Treasury finally started clearing out its enormous backlog of income tax refunds last week.  While evidence of any impact on consumption patterns has been scant, we still think the extensive payment delays are likely to push some household purchases back from February to March.

Federal Reserve Commentary

MMO Analysis