Core PPI was released this morning with a target miss impacting supply chain, but what’s the bull case for tomorrow’s CPI report?
A target hit would endorse and encourage FED’s continued tapering of 15b reduction in asset purchases and the timeline of hike in interest rates which are both contractionary monetary policies. Bearish.
A target miss on the upside might signal further stagflation impacting primarily the middle/lower class consumer spending. Tapering would still ensue most likely. Bearish.
A target miss on the lower side (unlikely) might signal an accelerated speed of tapering and a pull on the time horizon on interest hike lowering aggregate supply of money. Very Bearish.
So what’s the upside?
Position: weekly QQQ puts rolling over every week.
Disclaimer: This information is only for educational purposes. Do not make any investment decisions based on the information in this article. Do you own due diligence or consult your financial professional before making any investment decision.