Just as the second-largest bank failure in US history easily overshadowed nonfarm payrolls last week, so too will the specter of systemic risk and contagion from the SVB implosion eclipse a fresh read on US inflation in the week ahead.

That’s not to say CPI data due Tuesday won’t be meaningful. Indeed, it could make a bad situation worse in terms of sentiment if it underscores the idea that the gap between r-star and r-double-star+ is even wider than we thought.

Put differently, the SVB collapse spoke loudly to the notion that the Fed’s tightening cycle is now on the brink of jeopardizing financial stability, but the data continues to suggest that rates aren’t sufficiently restrictive to curb demand commensurate with a slowdown broad enough to balance the labor market.

If that’s the case, the Fed may have to choose between financial stability and inflation. You could argue they should prioritize the latter given that a serious financial meltdown would do wonders to correct the inflation problem. If all it’d take to trigger a catastrophe is another 50bps rate hike, and a catastrophe would almost by definition cure inflation, then we may as well get it over with.

I’m joking. I guess. But who knows. That’s what makes it fun(ny).

Consensus is looking for MoM gains of 0.4% on both headline and core US CPI. Some banks see upside. “Overall, the mix of news flow and data makes a 25bps hike at the March meeting more likely than a 50bps hike, in our view, though stickier price data next week could lead to some rebuilding of premium for the larger hike,” Goldman’s Praveen Korapaty wrote.

Goldman expects core CPI rose 0.45% last month from January. That may not sound like a big difference, but it rounds up to 0.5%, which would constitute a beat and likely result in an adverse knee-jerk reaction across markets.

Last week was a veritable rollercoaster for US rates+. Jerome Powell’s congressional testimony marked the crescendo of the post-January NFP hawkish repricing, which promptly collapsed on Thursday and Friday as SVB was forced into receivership.

“There’s been a fair amount of chatter surrounding the impact that auto prices will have on the aggregate CPI figures given the increase in the Manheim index seen during February after used car and truck prices served as a drag on the inflation data over the past three months,” BMO’s Ian Lyngen and Ben Jeffery said. “Along with cars, OER remains a pillar of the strength with the core inflation data, and the collective expectation is for further moderation as the lagged influence of the pullback in real estate prices continues to make its way through to the inflation complex.”

The Fed is hyper-focused on core services ex-housing. There’s been no progress on that front whatsoever, which means there’s no margin for error when it comes to any resumption of inflation pressures in goods and/or any refusal on the part of shelter inflation to moderate in line with expectations.

“We expect next week’s CPI report to confirm that core price inflation continued to gather momentum on a MoM basis in February after reaching last year’s low of 0.3% in November,” TD analysts including Jan Groen and Oscar Munoz remarked. They too see upside to consensus. “In effect, we forecast a third consecutive acceleration for the core CPI series to 0.5% MoM in February, which would lift its three-month annualized pace to 5.2% from 4.6% in January.” Like Goldman, it’d be a matter of rounding. TD’s forecast for core is actually 0.46%. But most algos aren’t going to parse the nuance — 0.46% would be 0.5%.

In addition to CPI, US retail sales are due. That’s another potential land mine. Obviously, consumption was robust in January, and if February was an encore, that’d be additional evidence of a hot economy and argue for more aggressive monetary policy.

Consensus is looking for a 0.3% decline in nominal spending. Suffice to say another advance would be tough for markets to digest assuming the inflation figures are still warm.

That’s far from the end of it. The US data docket is very crowded this week. In addition to CPI, PPI and retail sales, traders will get NFIB, the Empire and Philly Fed surveys, the preliminary read on University of Michigan sentiment for March and housing data including NAHB and starts. Jobless claims will be watched closely as well after jumping the most since October.

Also on the calendar: The March ECB meeting and Chinese activity data for February.

All of this will play out amid what’s almost sure to be a dramatic week in the US banking sector. The FDIC initiated an auction process for SVB late Saturday. Markets should know something by Sunday evening.

“We’re very aware of the problems that depositors will have,” Janet Yellen said, on CBS’s “Face the Nation.” “Many of them are small businesses that employ people across the country and of course this is a significant concern and… regulators are try[ing] to address these concerns.”

Writing late last week, BMO’s Lyngen said the Fed’s “pre-meeting communication moratorium [means] Timiraos and the WSJ will have the final say in terms of providing the official unofficial guidance of what to expect at the March FOMC meeting.”

I’d gently suggest that depending on how things develop in the world of regional banks, Powell might be compelled to break the moratorium.