Win McNamee/Getty Images News Things are getting edgy as traders seek to assess the thinking of the Federal Reserve going into 2023. Chair Jay Powell is set to participate on Tuesday in an International Symposium on Central Bank Independence hosted by the Sveriges Riksbank, in Stockholm, Sweden. While the event, which will start at 9 a.m. ET, may not include any updates to the state of U.S. monetary policy, markets will still be hanging on to every one of his words. Snapshot: Powell’s speech follows a solid jobs report for the U.S. economy. Wage growth is rising, but cooled enough to bring down inflationary pressures, while employers are still hiring – at a pace of 223,000 in December – but are slowing down from last year’s unsustainable figures. The unemployment rate also came in at 3.5%, marking its lowest level in decades. Many hope the data shows that a soft landing is still possible, especially when taken into account with other economic numbers. The Consumer Price Index will be released on Thursday and is forecast to show the sixth straight month of falling inflation (at a pace of 6.5%). According to CME’s FedWatch tool, traders are now pricing in a 77.2% chance that the FOMC will only raise its key lending rate by 25 bps at the end of January, continuing to slow the pace of its increases. Outlook: Earnings season also kicks off this week, with results and guidance helping paint the state of the U.S. economy. A special thanks to everyone who participated in Wall Street Breakfast’s “Survey Monday.” The poll was split pretty evenly among the nearly 500 participants, with 56% believing that S&P 500 companies will report their first losing quarter since 2020, compared to 44% who expect Q4 to still see some earnings growth.
