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BofAML's Preusser: See Only One Fed Hike This Year

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The Fed is set to make a decision, Trump selects his Supreme Court appointment, and it's PMI day. Here are some of the things people in markets are talking about today.

Federal Reserve

At 2 p.m. ET the Federal Reserve Open Market Committee will announce its latest monetary policy decision, and with only one of 94 economists surveyed by Bloomberg expecting a rise in rates, investor attention will concentrate on the statement's language to gauge how the bank is reacting to the new administration. There is no press conference today, and current market-implied probabilities of a hike do not rise above 50 percent until the June meeting.

Supreme Court pick

President Donald Trump’s Supreme Court nominee Neil Gorsuch is set to meet with senators today for what may be a contentious confirmation fight. Gorsuch, 49, is seen by conservatives as being a worthy replacement for Antonin Scalia, whose death has left a seat empty at the court for almost a year. Republicans are hoping to have him confirmed in time for court arguments in April

PMI day

China's official factory gauge came in slightly ahead of expectations at 51.3 in January, with non-manufacturing PMI at 54.6. Manufacturing in the euro area picked up as the IHS Markit Purchasing Managers Index climbed to 55.2, up from 54.9 in December. In the U.K. headline manufacturing activity was at 55.9 as factories saw input costs rise at a record pace following the drop in sterling. Markit U.S. manufacturing PMI is due at 9:45 a.m. ET, with ISM manufacturing due 15 minutes later.

Markets recover

Overnight, the MSCI Asia Pacific Index added 0.1 percent while Japan's Topix index closed 0.4 percent higher as mining shares rallied and investors reacted to the positive China data. In Europe, the Stoxx 600 Index had gained 1 percent by 5:40 a.m. ET as stocks bounced back after a three-day selloff. U.S. index futures pointed to a higher open.

Dollar 

The greenback is gaining against its G-10 peers this morning after yesterday's selloff. German Chancellor Angela Merkel rejected accusations from Peter Navarro, the head of the White House National Trade Council, that her country is gaming foreign-exchange markets, while Japanese Prime Minister Shinzo Abe and the country's top foreign-exchange official both rejected Trump's assertion that Japan was devaluing the yen

What we've been reading 

This is what's caught our eye over the last 24 hours.

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