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FOMC minutes ahead, risks below?

Tomorrow brings us the Fed's minutes from their November meeting at 2:00 pm EST. We'll be paying careful attention to what is said about the economy, and in particular inflation, the jobs market, and consumers.

During the November FOMC press conference Chair Powell made it clear he wasn't satisfied with the progress being made, felt that the terminal rate had to go higher than previously thought, and expressed concern about how tight the job market remained. He stated that the consumer remained resilient and that the Fed wanted to see below trend growth (or what we feel is really Fed language for a demand destroying recessionary environment).

While the Fed's press conference rattled the market after a seemingly vaguely dovish policy statement regarding "cumulative tightening", those losses have been more than made up, almost as if they never happened.

But tomorrow will bring a rather jarring reminder of just how hawkish the Fed was during the last meeting, and I think it may give the bear market rally a reason for pause.

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