WISDOMTREE- Weekly commentary from Professor Jeremy J. Siegel (07/25/2022) :
We have much more evidence of economic weakness. The drop in the National Homebuilders Index was shocking, the largest one-month drop in 37 years (except for April 2020 pandemic month). Jobless claims also rose, and several manufacturing indexes turned lower.
This week is the FOMC meeting and with this weakness, they will go 75 bps, and hopefully indicate cooling inflation will make further increases more modest. There will probably be dissents, George on the side of 50 bps and perhaps Bullard for 100. The money supply will also be reported this week. The early read on weekly deposits suggest another flat to down month. Forward looking real (as opposed to reported) inflation has flattened, and there will be less pressure on wages. The Fed must watch not to overplay its belated anti-inflationary rhetoric.