Fed Eyes Cuts Amid Mixed Data

Date: February 20, 2026

Fed Eyes Cuts Amid Mixed Data

Summary

Market Snapshot

Prior Close
Asset Level Days Change
S&P 500 6,876.80 -0.24%
Nasdaq 22,682.73 -0.31%
Spot VIX 20.57 +1.68%
2 Year Bond Yield 3.48 +2 bps
10 Year Bond Yield 4.08 -0 bps
EUR/USD 1.1767 -0.02%
USD/JPY 155.31 +0.15%
GBP/USD 1.348 +0.13%
WTI Oil 66.09 -0.46%
Gold 5,027.18 +0.59%
Bitcoin 68,162.55 +1.78%

Prior Economic Events

Data Prior Cons Actual
Speech by Fed's Bostic---
Trade Balance-53m-55.5m-70.3m
Exports Level292.3m-287.3m
Speech by Fed's Bowman---
Goods Trade Balance Adv-82.8m-86m-98.5m
Imports Level345.3m-357.6m
Weekly Jobless Claims229,000225,000206,000
Philadelphia Fed Manufacturing Index12.608.5016.30
Retail Inventories Ex Autos Month-over-Month Adv-0.20-0.20
Wholesale Inventories Month-over-Month Adv0.200.200.20

Upcoming Economic Events

Data Prior Cons Time
Core PCE Price Index Month-over-Month0.200.3008:30
GDP Growth Quarter-over-Quarter Advance Estimate4.40308:30
Personal Income Month-over-Month0.300.3008:30
Personal Spending Month-over-Month0.500.4008:30
GDP Price Index Quarter-over-Quarter Adv3.70-08:30
PCE Price Index Month-over-Month0.200.3008:30
PCE Price Index Year-over-Year2.802.8008:30
Speech by Fed's Bostic--09:45
S&P Global Composite PMI Flash53-09:45
S&P Global Manufacturing PMI Flash52.4052.6009:45

Yesterday's Recap

The US trade balance deteriorated sharply to a deficit of $70.3 billion, worse than expected $55.5 billion, driven by weaker exports and higher imports. Weekly jobless claims improved to 206,000, beating consensus of 225,000, while the Philadelphia Fed Manufacturing Index surged to 16.3 from 8.5, indicating robust factory activity. Retail inventories rose 0.2%, aligning with consensus, amid mixed signals from Fed speeches on Bostic and Bowman that emphasized data dependence.

The Day Ahead

Core PCE is expected at 0.3% m/m, up from previous 0.2%, potentially signaling persistent inflationary pressures for Fed watchers. GDP growth advance estimate forecasts 3% quarterly, contrasting with prior 4.4%, while personal spending consensus holds at 0.4% m/m. Fed's Bostic speech at 9:45am and S&P Global PMI flashes may offer fresh policy clues ahead of key inflation data.

Other Economic Notes

European firms adopting AI are boosting productivity by 4% on average, per new causal evidence, highlighting opportunities for EU growth amid US trade tensions. US trade deficit surges underscore reliance on imports, complicating Trump's tariff push and global supply chains. Rising utility costs, up 56% since 2020, are straining households, amplifying affordability concerns in a cooling labor market.

Fed Watch

Recent data reveals a hawkish tilt with falling jobless claims indicating labor market strength that could reduce the urgency for further cuts, while resilient manufacturing and trade deficits add inflationary pressures. Fed speeches stress data dependence, suggesting cautious pace toward easing amid mixed signals on inflation and growth. Markets pricing fewer cuts reflects this tension, with June cuts now likely if PCE cools as expected.


Source: https://robomacro.com/Research_Notes/US_Macro_Daily_20260220.html