NEW YORK, Dec 12 (Reuters) – Options traders are bracing for a week of swings in U.S. stocks ahead of key inflation data, the Federal Reserve’s last policy meeting of 2022 and the final monthly options expiration of the year.
Inflation data and the Fed’s outlook on monetary policy could give traders more clarity on how much further the central bank may need to raise rates in its battle to cool consumer prices, potentially determining the trajectory of a late-year rally in stocks that has seen the S&P 500 bounce 14% off its October lows. The index remains down 17% for the year.
Pricing in the U.S. options market on Monday implied investors were positioned for the S&P 500 to move 2.5% in either direction in the wake of Tuesday’s consumer price report, which covers November, data from options market-making firm Optiver showed.
A big move would be par for the course in a year during which CPI data has sparked explosive market…
