May the 4th be with you

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“Many of the truths we cling to are based on a certain point of view”
– Obi Wan Kenobi
In life imitating art we indeed find that perspective is a significant part of interpreting what the data means for the economy and thus the Fed and interests rates.  Today we are largely seeing pressure from a labor cost beat.  In a vacuum I might agree with this action.  Higher wages could lead to inflation.  My issue with the reaction is that in the last week most if not all of the data leading up to NFP has been weaker, save ISM services.  I’m not connecting the dots myself, and I suppose this will eventually come out in the wash, but for now we’re left with some decisions to make.  Lock or float into tomorrow.
In the end my ranges and my lock/float bias are unaffected by todays action.  If you are 1-2 weeks outs lock, 2+ weeks out float.  Either way don’t chase losers.  You missed the boat at 2.14.  Lastly, don’t put all your eggs in either basket.  I still have a roughly 70/30% medium range rate favorable perspective.
TK421 is still not at his post…
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-Philip Mancuso

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