All eyes are on the Federal Reserve's June meeting this week. While no change in interest rates is expected, the tone and tenor of this gathering will still go a long way in determining market direction this summer. Economic growth has been weaker than expected (bad) while inflation, a key focus for the central bank, has shown a welcome deceleration (good). This combination suggests that the disinflationary trend may be gaining traction, despite the specter of tariff-related price hikes. It remains to be seen how and when tariffs will appear in the data, which creates a delicate balance for policymakers. Ongoing uncertainty means that investors will pay extra attention to the Fed's quarterly Summary of Economic Projections (SEP). Released alongside the policy statement, the SEP provides a look into where individual (anonymous) Fed officials see growth, unemployment, and inflation heading. Most importantly for markets, it includes the "dot plot," which maps out their respective expectations for the future path of interest rates. Given the crosscurrents of slowing growth and uncertainty about inflation, the Fed’s updated forecasts and Chair Jerome Powell’s commentary will be scrutinized for any shift in outlook. How they message their confidence—or concerns—about the path forward will go a long way in determining if stocks can continue rallying or if the music is about to stop.

Economic and Earnings Calendar

Monday

•   June Empire State Manufacturing Activity: The New York Fed’s survey of manufacturing executives in the region on business conditions and their outlook.

•   Earnings: Lennar (LEN)

Tuesday

•   May Retail Sales: This measures spending at retail stores and is a key indicator of consumer demand.

•   May Import/Export Price Indexes: These indexes track the changes in the prices of nonmilitary goods and services traded between the U.S. and the rest of the world.

•   June New York Services Activity: The New York Fed’s survey of manufacturing executives in the region on business conditions and their outlook.

•   May Industrial Production and Capacity Utilization: The industrial sector accounts for much of the cyclical swings in economic activity.

•   June NAHB Housing Market Index: This index tracks how homebuilders feel about the current and future state of the single-family housing market.

•   Earnings: Jabil (JBL)

Wednesday

•   May Building Permits and Housing Starts: Construction data is a leading indicator of economic activity.

•   FOMC Interest Rate Decision: The Federal Reserve will announce any changes to monetary policy after the conclusion of its two-day FOMC meeting, in addition to providing commentary on the economy. It’s one of eight regularly scheduled meetings per year.

•   Weekly Mortgage Applications: Mortgage activity gives insight on demand conditions in the housing market.

•   Weekly Jobless Claims: This high frequency labor market data gives insight into filings for unemployment benefits. Jobless claims have continued to show a labor market that remains strong despite having cooled.

Thursday

•   Markets are closed on Juneteenth.

Friday

•   June Philadelphia Fed Manufacturing Activity: The Philadelphia Fed’s survey of manufacturing executives in the region on business conditions and their outlook.

•   May Leading Economic Index: This is an index composed of various economic indicators that have historically led changes in the broader economy.  

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