We noted in our Sunday sketch that the clear risk is for key releases to disappoint, to fall south of expectations, and that traders were to prepare for that reality. Given we have in hand that flaw common to most models we have a major leg up on the market crowd.
Since Sunday of course this anchor has held. It will continue to hold, most releases, until economists catch on. That will take a bit.
Friday we have the Q1 GDP advance. This is the one release which may not fit; that is, consumption may push the headline just a tad north of consensus, but if so - odds, 40% - only a tad. Because Q1 is ancient history and because our anchor will likely hold for the near term, counter-trade such a result.
This is true even if the Consumption component of the advance is through expectations.
Robert Craven
Since Sunday of course this anchor has held. It will continue to hold, most releases, until economists catch on. That will take a bit.
Friday we have the Q1 GDP advance. This is the one release which may not fit; that is, consumption may push the headline just a tad north of consensus, but if so - odds, 40% - only a tad. Because Q1 is ancient history and because our anchor will likely hold for the near term, counter-trade such a result.
This is true even if the Consumption component of the advance is through expectations.
Robert Craven
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