Equities pulled back a little on Thursday as traders and investors braced for what could be a very hot CPI reading. The index is released today and is expected to show another year-over-year increase in consumer-level inflation that is well above the 2.0% mark. The data will influence the FOMC at their meeting next week and could result in a much faster than expected taper. More importantly, the data will shed new light on when the first FOMC rate hike will come and we think that will be in early Spring at the latest.

Next week we?ll get a slew of data including housing, retail sales, and the Producer Price Index which is also expected to show hot inflation. With earnings on the back burner, the inflation data and FOMC meeting are what will influence trading for the week.