A strong jobs report followed by comments from Fisher and Lacker weighing
Higher interest rates and a strong dollar have led to the worst day in the S&P 500 since January 5. The index fell 30 points to 2071 and is down 2.27% from it's high on Monday.
This feels like a new phase of US dollar strength and the stock market is less enthusiastic about it. The euro is coming apart and USD/JPY could be breaking out. As crowded as the dollar trade is, it still feels like it has some room to run.
Lacker was hawkish as usual and Fisher has also been on the wires (he retires March 19). Here are his comments, which underscore Fed hikes, even if they're predictable from him:
- Path forward will call for higher rates
- Wage prices pressures are still so far pretty tame
- Judging impact of dollar on US economy is not straightforward
- US jobless rate getting close to full employment
As the day winds down I can't help but think these moves are a bit overdone in the short term and that Monday will be a bit of an unwind but in the bigger picture, the US dollar can't be stopped.
On the week, the S&P 500 fell 1.6%.
