Algos have ramped almost 1% higher overnight on a modest but noticeable breakdown in VIX.
All eyes are on the FOMC which is expected to announce a rate hike of anywhere from 50-100 bps at 2PM ET. Bulls are still clinging to the prospect of a soft landing, while bears see dark economic storm clouds approaching.
Given this morning’s disappointing retail sales data, which saw spending slump 0.3% MoM in May (-0.7% exclulding gasoline sales), it is increasingly difficult to ignore the notion that the Fed is tightening into an economic slowdown.
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