The past week was an eventful one as several news reports came out that likely upended the conventional wisdom regarding rate hikes. There also seems to be a disconnect between what the Fed is doing compared to what the European Central Bank (ECB) is planning in terms of future rate cuts.

The week got off to a relatively slow start news wise as markets had their eyes of inflation data released on Wednesday. On Wednesday, it was revealed that inflation had gone up .4 percent on a monthly basis and increased to 3.5 percent on a yearly basis. It was expected that inflation had accelerated by .3 percent on a monthly basis and 3.4 percent on an annual basis.

This led to some members of the Fed speculating that there wouldn’t be any rate cuts at all during 2024. However, many still believe that there is going to be at least one rate cut in the second half of the year. It is unlikely that any movement will take place until at least June as Fed Chair Powell has stated that he is in no hurry to move. Instead, he will wait for the data to confirm that inflation is moving closer to the 2 percent benchmark before easing monetary policy.

On Thursday, price and unemployment reports were released to the public. The Price Producer Index (PPI) revealed that the cost of core goods increased by .2 percent. In addition, prices for all goods were up by .2 percent on a monthly basis. Overall prices were expected to increase by .3 percent on a monthly basis, and both the core and overall PPI were down from last month when they came in at .3 percent and .6 percent, respectively.

Unemployment data revealed that 211,000 people filed for benefits in the past week, which was down from 222,000 last week. Analysts had projected a total of 216,000 claims over the past seven days.

On Friday, the University of Michigan revealed its preliminary consumer sentiment and inflation expectation reports. Consumer sentiment came in at 77.9 percent while respondents believed that the inflation rate would be at 3.1 percent a year from now.

The Nasdaq was down 77.76 points this week to close at 16,175. During the first half of the week, the Nasdaq tumbled before hitting a low of 16,111 on Wednesday morning. It would then rebound to hit a weekly high of 16,450 on Thursday afternoon before easing back to its closing price.

The Dow was down 990 points this week to close at 37,983. It would open at its highest point of the week Monday morning at 38,974 before tumbling the next five trading days. On Friday morning, the Dow would reach its weekly low of 37,894.

Finally, the S&P 500 fell almost 86 points to close the week at 5,123. As with the Dow, the index would start the week at its highest point opening at 5,215 before spending the rest of the week in a freefall. Like the Dow, the S&P made its weekly low on Friday when it dipped to 5,111.

There were a few important announcements outside of the United States as the Bank of Canada (BOC) announced that its key interest rate would remain at 5 percent. The ECB announced that its key interest rate was holding steady at 4.5 percent on Thursday morning. Interestingly, it announced plans for a rate cut in June, which is where it would diverge from the Fed and other central banks. On Tuesday night, New Zealand announced that it was also holding steady on interest rates by keeping its base rate at 5.5 percent.

The upcoming week should be another consequential one for investors. Retail sales data will be released on Monday morning, and it’s expected that core retail sales were up .4 percent while overall retail sales were up .5 percent on a monthly basis. Thursday sees the release of unemployment claims data, and it’s expected that 214,000 people applied for benefits. Finally, Jerome Powell is expected to speak on Tuesday afternoon, and it’s likely that his words will provide some insight into the future of monetary policy.

The final trading week in March was truncated due to markets being closed for the Good Friday holiday . However, there were multiple news events released throughout the week with a few important pieces of information released on Friday morning.

On Monday, new home sales figures were released, and in the month of February, there were 662,000 such sales. This was lower than the expected 675,000 and lower than the January total of 664,000. A reduction in new home sales might indicate tightness in the housing markets, which may impact home prices as well as interest rates on new mortgages. All of these variables can have a impact on inflation as well as the overall health of the economy.

Multiple news reports came out on Tuesday with the CB Consumer Confidence report being the most important to traders. It came in at 104.7, which was lower than the expected 106.9 and lower than the 104.8 figure from February.

Core durable orders were up .5 percent while durable orders overall increased 1.4 percent on a monthly basis. Each figure came in higher than expected and represented a rebound from the previous month in which core durable orders were down .4 percent and durable orders overall were down 6.2 percent.

On Thursday, monthly pending home sales data was released, and it found that there was a 1.6 percent increase during February. This was much higher than the drop of 4.7 percent in January and was also higher than the expected gain of 1.4 percent prior to the news release. In addition, unemployment claims data was released Thursday morning, with 210,000 requests for benefits over the past seven days.

Final gross domestic product (GDP) figures for the final quarter of 2023 were made public on Thursday morning. For the final three months of 2023, the economy expanded by 3.4 percent compared to an expected 3.2 percent, which likely continues to bolster the idea that the Fed will be able to achieve a soft economic landing despite keeping interest rates elevated.

Finally, the revised University of Michigan consumer sentiment and inflation expectation figures were made available on Thursday morning. Consumer sentiment was at 79.4 percent compared to an initial 76.5 percent while inflation expectations dropped from 3 percent to 2.9 percent.

On Friday, the Core PCE Index came in at .3 percent on a monthly basis, which was what analysts expected prior to the release. It was also lower than the .5 percent figure reported in February. Later on Friday, Fed Chair Jerome Powell said that he was pleased that the report came in as expected. However, he cautioned that there was no rush to cut rates and that he wanted to see more data indicating that inflation was getting closer to 2 percent.

The S&P 500 was up 13.53 points to close at 5,254 for the week. It would make a weekly low of 5,204 on Tuesday before reversing and making a weekly high of 5,263 late on Friday before easing back to the closing price.

The Dow closed slightly lower this week losing 16.08 points to finish at 39,807. Like the S&P, this index made its weekly low on Tuesday of 39,292 before rebounding and making a high of 39,855 late on Friday.

Finally, the Nasdaq also finished slightly lower this week falling 18.07 points to close at 16,379. On Wednesday, the market made its weekly low of 16,298 while the weekly high was put in place on Tuesday when it hit 16,461.

This week will see the release of the nonfarm payroll (NFP) report for March on Friday. The Job Openings and Labor Turnover Survey (JOLTS) report will be issued on Tuesday. The ADP version of the NFP report will be released on Wednesday. Jerome Powell is also expected to give a speech on Wednesday, which the markets will follow closely.