Sujata Ro shows us the future.

According to the World’s Largest Economy, it will experience a record-breaking GDP growth rate of 5.5%. Data are due Thursday. JPMorgan (NYSE 🙂 estimates that the number could reach 7.5%. It is also possible that weekly claims for unemployment benefits will drop further.

This is how the U.S. Federal Reserve believes there is “quite some room to increase interest rates”.

Are there more rate increases than expected this year? Powell didn’t deny the possibility. Markets have begun to price in a fifth rate rise.

The gap between Treasury’s two-year and 10-year yields has shrunk to 23 months, as the Treasury borrowing costs reached 23-month highs. Tradeweb reports a steepening in tbills (the shortest-dated type of debt), with the gap between 3- and 6-month yields the highest since 2015 and nearly twice as high than a month ago.

A similar steepening can be observed between bill maturities, which is a sign that more tightening has been priced.

The stock market selloff, which was under control before Fed is now in full swing with global stocks falling 0.6% and Wall Street and European markets both down 0.6%.

However, bargain-hunters of another sort are available if buyers feel scared. Bill Ackman, a billionaire who bought $1 billion of Netflix shares (NASDAQ:) after Thursday’s stock market crash.

In the meantime, companies continue to offer good news. Tesla (NASDAQ:), for example, predicted that it would see 50% growth in 2014, and Deutsche Bank (DE) made its highest profit since 2011. Tesla shares plummeted in the after-hours trading, as many buyers remain in hiding.

Graphic: Fed policy trails inflation by historic margin, https://graphics.reuters.com/USA-FED/gdpzynrmnvw/chart.png Key developments that should provide more direction to markets on Thursday:

China’s industrial enterprises saw December profits rise at the slowest rate in 1-1/2 Years.

German consumers are happier

New Zealand’s inflation is at its highest level in three decades

South Africa is expected to increase rates 25 bps

U.S. Durable Goods/Advance Q4 GDP Reading/Initial Jobless Claims

-U.S. 7-year note auction

Blackstone (NYSE;), Dow chemicals and Southwest airlines. -U.S. earnings: Mastercard (NYSE.), Mastercard (NYSE.), JetBlue. -US earnings: Visa (NYSE.), Visa (NYSE.), Mondelez.

-European earnings: LVMH Moet Hennessy Louis Vuitton, Dr Martens, UniCredit Britvic, St. James’s Place STMicroelectronics, SAP, Deutsche Bank, IG Group, Diageo (LON:), Sabadell, SEB, Polymetal