Markets Prepare for Data-Heavy Week Amid Fed Tightening

Markets are bracing for a data-heavy week ahead of key economic releases and interest rate decisions. Fed Chair Kevin Warsh's speech at Jackson Hole was seen as hawkish, with him declining to offer forward guidance. He stated that he is 'committed to a discipline, not a decision'.

The Federal Reserve's tightening stance has been reinforced by recent inflation prints, which have been better than expected. However, Fed Chair Warsh noted that these improvements do not yet indicate meaningful trends in the underlying economy.

Market expectations for rate hikes have increased, with futures now implying 2.4 rate increases over the next 12 months, up from 1.8 a week earlier. The odds of a September hike have risen to about 60% from 35%.