WSJ:
Federal Reserve officials are preparing to slow interest-rate increases for the second straight meeting and debate how much higher to raise them after gaining more confidence inflation will ease further this year.

They could begin deliberating at the Jan. 31-Feb. 1 gathering how much more softening in labor demand, spending and inflation they would need to see before pausing rate rises this spring.

US GDP
Now: 2.9%
Expected: 2.6%

The share of Americans who say they live paycheck-to-paycheck climbed 3% last year

Powell: We have a different forecast from markets, given our outlook, don't see us cutting rates this year.

The Nasdaq 100 jumped 10.6% in January, its best opening month performance since 2001.

Markets don't believe Powell

https://www.bls.gov/news.release/empsit.nr0.htm

The unemployment rate fell to 3.4%, the lowest since 1969. I think fewer people file for unemployment nowadays because they have to have multiple jobs to survive and not eligible for unemployment benefits.

Unemployment rate vs. SPX

Federal Reserve Bank of Minneapolis President Neel Kashkari said January’s strong labor-market report shows the US central bank needs to keep raising interest rates.

5.4% target 🤔

CPI YoY 6.4% (predicted 6.2%)

Fed's Bullard: the Fed risks a replay of the 1970s if it can't lower inflation soon. Wouldn't rule out supporting 50bps March hike.

Morgan Stanley Says S&P 500 Could Drop 26% in Months

Federal Reserve officials may need to raise interest rates as high as 6.5% to defeat inflation, according to new research that was sharply critical of the central bank’s initially slow response to rising prices.

In a paper presented Friday at a conference in New York, a quintet of Wall Street economists and academics argue that policymakers still have an overly-optimistic outlook and they will need to inflict some economic pain to get prices under control.