- US Retail Sales data came out stronger than expected: US Retail Sales Control Group (0.7% actual vs 0.4% consensus expectation) and US Retail Sales Ex Auto and Gas (0.6% actual vs 0.2% expected).
- Initial Jobless Claims came out lower than expected (242k actual vs 251k expected), reversing the surprise from last week.
- Fed speakers such as Lorie Logan were hawkish. She said that a pause in June isn’t likely given price pressures remaining strong. Fed Chair Jerome Powell, however, said no decision has been made yet for June.
- From a previous expectation of three interest rate cuts starting July, markets are now pricing in just one to two 25-bp cuts by year-end 2023, but only a 15% chance of a hike in June.
- US debt ceiling negotiations were described as “productive” but a deal remains elusive.