The Week Ahead – Anticlimactic

Investments & Economy The Week Ahead Grow

The Week Ahead – Anticlimactic

Andrew Chan, CAIA, Co-Chief Investment Officer

| 6/11/18 7:38 AM

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Welcome to “The Week Ahead” where we take a moment to provide our thoughts on what we can expect in markets and the economy during the upcoming week.

Congratulations to the Golden State Warriors for winning the NBA Championship! Sports pundits across the world for the most part all had agreed that the Warriors were heavy favorites to win their third championship in four years. The only real question was would it be a four game sweep or possibly go five or six games. After an exciting game one, the rest of the series was merely a formality of the inevitable. Sorry, Cleveland Cavaliers fans!

Global investors will be focused on this week’s FOMC meeting. With the current market pricing in a 93% chance of the second rate hike of 2018 occurring this week, the real question now is if the Fed hikes three or four times this year. Why the potential of a fourth rate hike this year? A few reasons, such as solid economic data in terms of an exceptional labor market, steady economic growth, and positive inflation (albeit a slow grind). Extremely resilient financial markets are also playing into the equation, as the market has been able to shrug off February’s domestic equity swoon, slowing European growth, ItalEXIT fears, trade wars, and volatility in emerging markets. All eyes will be on the dot plot to see if there is any change there, but the more likely avenue will be more hawkish “Fedspeak” at the press conference by Fed Chair Powell and subsequent speaking engagements by Fed governors. If you recall, the Fed has telegraphed out the runway for interest rates pretty clearly since the Great Financial Recession and the last thing they would want would be a surprise. Anticlimactic.

Data deck for June 9 – June 15:

Date	Indicator	Period
June 12	NFIB Small Business Optimism	May
June 12	Consumer Price Index	May
June 13	Producer Price Index	May
June 13	FOMC Rate Decision & Press Conference	----
June 14	Initial Jobless Claims	----
June 14	Import Price Index	May
June 14	Advance Retail Sales	May
June 14	Business Inventories	April
June 15	Empire Manufacturing	June
June 15	Industrial Production	May
June 15	University of Michigan Consumer Sentiment	June

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Andrew Chan, CAIA, Co-Chief Investment Officer

About the Author

Andrew Chan, CAIA, Co-Chief Investment Officer

Mr. Chan co-leads the strategic investment committee and is responsible for overseeing First Foundation Advisor’s investment solutions platform which includes conducting investment manager research for both traditional and alternative investments as well as asset allocation guidance for portfolio construction. As a member of the investment committee, he provides market commentary and investment insights to clients. Additionally, Mr. Chan serves as a senior executive on the business strategy committee providing guidance on firm wide initiatives. With over 15 years of wealth management experience, Mr. Chan has played key roles across various aspects of investment and wealth management. Prior to joining First Foundation Advisors, Mr. Chan was most recently a portfolio manager at U.S. Trust where, in addition to his daily responsibilities, he served on numerous national committees including the investment manager committee, the portfolio model committee, and the strategic technology committee. He also served on the in-house strategic consultant committee reporting directly to the President of U.S. Trust. Mr. Chan is a graduate of the Wharton School Executive Program on Investment Management and holds a Bachelor of Arts degree in Business Administration from the University of California, Riverside. He is a Chartered Alternative Investment Analyst (CAIA). Mr. Chan has previously served as an exam working group member and as an exam grader for CAIA. A member of the CAIA SoCal Executive Board since 2015, Mr. Chan has served as executive chapter head since 2017. Read more