“The market doesn’t reward the smartest traders. It rewards the most disciplined ones.”

1. US Retail Sales Rise in Broad Gain Despite Higher Gas Prices — The value of retail purchases rose 0.9%, marking a fourth straight month of increases, Census Bureau data showed Wednesday. The figures aren’t adjusted for inflation. The report shows consumer spending strengthened heading into the summer even as average gasoline prices rose to the highest level in almost four years. Companies have also noted demand continues to hold up, with big-box retailers including Target Corp. and Walmart Inc. signaling shoppers are resilient despite years of elevated inflation. Still, the card data suggest wealthier Americans are spending at faster rates while lower-income households face tighter budgets and elevated borrowing costs. Recent reports have also shown a decline in inflation-adjusted wages and a slide in the saving rate, and some retailers have emphasized that many consumers are seeking value when making purchase decisions.
2. Fed Holds Rates Steady, but More Officials See Higher Rates as Next Move — Federal Reserve officials signaled Wednesday that their next move might be to raise interest rates, not cut them, a striking reversal at Kevin Warsh’s first meeting as chairman and a sign of how sharply the inflation outlook has turned.
The Fed held its benchmark rate steady, in a range of 3.5% to 3.75%, in a unanimous vote. But officials’ quarterly economic projections told the story of the shift: Nine of 19 officials penciled in at least one rate increase by year’s end, up from none in March. Just one foresaw a cut, down from 12. The U-turn reflected an economy that has run hotter than the Fed expected. Inflation has reaccelerated this year—driven up by the energy shock from the Iran war and a surge in demand tied to the boom in artificial intelligence. A labor market that officials had feared was weakening instead held firm.
3. Summary for the Week

The week ahead — Economic data from Econoday.com: