The usual first-of-the-month top-tier US data is split between two weeks in March. This week brings the ISM surveys. Traders will have to wait a week for an update on the labor market.

I think it’s fair to suggest that if the ISM prints are hot, and any upside to consensus on the headlines isn’t offset by soft reads on the price gauges, the risk for equities is to the downside.

Recall that January’s ISM services print was ahead of every estimate. Delivered as it was just an hour and a half after the blazing-hot jobs report, the consensus-beating read on activity served to punctuate the message from payrolls. Together, the two kicked-started February’s dramatic hawkish repricing across the US rates complex.

Consensus is looking for a marginal deceleration for February and a slight uptick on the manufacturing index. The latter is due Wednesday, the former Friday.

The figures come on the heels of preliminary readings on S&P Global’s PMIs for February which beat estimates. Final readings on those surveys are due this week as well.

As ever, it’s possible (likely) that the data will raise more questions than it answers. Such is life in the new macro regime. “ISM Services will be the more influential of the two reads on corporate sentiment in February after the impressive reversal in January, but within the details of the manufacturing gauge, we’ll be especially focused on the spread between new orders and inventories that has spent a period below zero historically only observed during recessions,” BMO’s Ian Lyngen and Ben Jeffery said, adding that “inventories building at a rate that outpaces new orders does not bode well for demand, and with the backward looking data in personal spending and retail sales starting the year strong, some closely tracked leading indicators do not paint as rosy a picture for the state of the economy.”

Again, there are conflicting signals and cross currents everywhere you look. Every seemingly straightforward assessment admits of frustrating caveats. For example, even if you’re inclined to write the muscular spending numbers for January (both retail sales and PCE) off as “backward looking,” note that even forward-looking indicators suggestive of slower demand don’t unequivocally presage disinflation. Bloated inventories can be inflationary too — the US is short of warehouse space, and storage for unsold goods isn’t free. Somebody has to pay that cost. Management will try to pass it along to consumers first and resort to discounting only later.

Traders will also watch the first read on European inflation for February this week. The focus is squarely on the core measure, which is hovering stubbornly at record highs.

Flash reads on S&P Global’s PMIs for Europe this month were upbeat, and even as falling natural gas prices have helped headline inflation moderate, there are growing concerns that an inflationary mindset is starting to embed in the wage-setting process. That puts Christine Lagarde under pressure.

ECB terminal rate pricing is around 3.75%. If that’s borne out, it’d mark a stunning 425bps of rate hikes out of negative territory in just ~one year’s time.

Generally speaking, markets have acquiesced to “higher for longer” across the developed world, with allowances for variations across locales.

All of this will be weighed by equities, which are begrudgingly on the back foot amid evidence that inflation in advanced economies will likely prove more persistent than economists anticipated. Imagine that.

It’s no secret that the ivory tower works from a different dictionary than the rest of humanity, but nobody expected this:

tran·si·to·ry

adjective

lasting or intended to last or remain unchanged indefinitely.

Also on deck in the US this week: FHFA and Case-Shiller home prices, Conference Board confidence and Fed speakers including Bostic, Bowman, Jefferson, Waller and, notably, Austan Goolsbee, who’s a second-tier candidate to replace Lael Brainard as vice chair.