Markets this week will get two key signals on how soon and to what extent the Federal Reserve will cut interest rates. The result could well be a test of investors' patience as indications mount that what was expected to be an aggressively easing central bank this year instead will be one where caution prevails.
" Inflation pressures persist Other indicators, though, could push the Fed toward a more defensive approach. Average hourly earnings rose another 0.3% in March and were up 4.1% from a year ago, still well above the pace that the Fed considers consistent with its 2% inflation goal, according to the Labor Department. While there are differing views over the cause-effect dynamics of wages and inflation, the elevated levels still being seen are another deterrent to action.