High points for US economic data scheduled for July 22 week

There are no Fed policymakers on the calendar due to the communications blackout period around the July 30-31 FOMC meeting. The period runs from midnight on Saturday, July 20 through midnight on Thursday, August 1. Expectations for the FOMC meeting are for no change in the fed funds target rate range but a signal that a cut could be coming.

The report most likely to have an impact on the FOMC deliberations is the advance estimate of second quarter GDP set for release at 8:30 ET on Thursday. The GDP Nowcasts point to growth stronger than in the first quarter. Expectations are an end to the series of outperformance in 2022-2023 with the economy now growing more in line with the FOMC’s longer-run forecast of 1.8 percent. The June report on retail sales was above expectations and included upward revisions in the prior month, so the personal consumption expenditures contribution could be more positive than previously expected. However, the GDP report will include annual revisions. There probably won’t be big changes to the path of growth in recent quarters.

Temperate expansion along with a rebalanced labor market and a resumption in disinflation should give FOMC participants the “greater confidence” they are look for to determine the time has come to cut rates. However, this is also a group of policymakers who are exercising patience and caution and who probably aren’t in a hurry. They can let financial markets do some of the work of easing conditions and let policy guidance do some more of it. That will give them another month or two of economic data to confirm that cutting rates is the right move at the September 17-18 meeting.