It’ll be a slow week in the US, or at least for macro watchers.

The data docket’s quite sparse, and Monday’s a holiday. The marquee event, if you can call it that, is the release of minutes from the January FOMC meeting, which’ll be parsed for any clues as to the Committee’s thinking around trade frictions.

Trump briefly imposed tariffs on Canada and Mexico two days after the Fed’s first 2025 gathering. Additional escalations are a foregone conclusion, even as Trump’s willingness to postpone the levies on America’s neighbors ultimately validated Jerome Powell’s contention that it’s far too early to make definitive judgments about the ramifications of a new trade war for inflation.

“As eager as the market is to derive the monetary policy implications from Trump’s initial actions, the Minutes aren’t likely to offer much insight beyond the fact that the FOMC was in wait-and-see mode as of Trump’s second week in office,” BMO’s Ian Lyngen and Vail Hartman remarked, adding that “while policymakers clearly weren’t in a position to give comprehensive guidance on the implications from Trump’s policies in late-January, it will be interesting to see the extent of any conversation about what were, at that time, working assumptions for targeted tariff increases.”

Benchmark US yields come into the new week sitting below 4.50%, down some 30bps from the mid-January highs. For now, geopolitical uncertainty, renewed questions about the growth outlook and, perhaps most importantly, Scott Bessent’s decision to stick with Janet Yellen’s forward guidance in his first QRA, appear sufficient to cap long-end yields, even as inflation’s stubborn. Indeed, there’s probably something to the idea that inflation’s persistence is itself a limiting factor for bond yields as markets price out Fed cuts, raising the specter of a Committee that’s constrained in its capacity to respond to a slowdown (i.e., hard landing risk’s under-priced).

There’s also some speculation that bonds have firmed on expectations that Elon Musk will single-handedly succeed in shoring up America’s fiscal position through mass layoffs across the federal bureaucracy. Rather than deride that notion, I’ll simply suggest there are better reasons to be bullish bonds if that’s how you’re leaning.

Other than the Fed minutes, fundamental US macro inputs are limited this week to a smattering of housing updates (February builder sentiment, starts and permits covering January and existing home sales for last month) and the final read on University of Michigan sentiment for this month, which’ll be eyed for any downward revisions to inflation expectations. (God forbid they should be revised higher. Recall that the year-ahead print jumped sharply in the preliminary release to the highest since late 2023.)

The figures above are from BMO’s Lyngen. They show the partisan split in the Michigan inflation expectations series. Suffice to say Republicans and Democrats harbor divergent views on the read-through for consumer prices of Trump’s policies.

Like everything else, inflation expectations are always colored by partisanship in America, but also like everything else, that dynamic’s now so acute as to render any and all attempts at analysis meaningless, or at least that’s how I see it.

Speaking of inflation, UK consumer price growth probably accelerated to the quickest pace in nearly a year last month. That update’s due from ONS on Wednesday. Recall that despite new forecasts suggesting inflation will run much faster than previously projected in the near-term, two Bank of England voters argued for a super-sized rate cut at the year’s first policy gathering.

Whatever headline space isn’t occupied by Trump’s tariffs and Musk’s meddling this week will be filled with the sad tale of Ukraine’s betrayal. The country’s set to be carved up by Trump and Vladimir Putin in the days and weeks ahead, with little input from Kyiv, and none at all from Brussels.