JEPI - The Fed's Dilemma At Its January 26-27 FOMC Meeting

• Last week, the 10-year Treasury bond yield continued to rise, as last Tuesday's bond auction had a lackluster bid-to-cover ratio of 2.47. This means that the Fed is going to have to do more quantitative easing or the federal government is going to have to curtail its spending.
• The Fed will also have to confront rising inflation. The Labor Department announced on Wednesday that its CPI rose 0.4% in December.
• Last week, the Labor Department announced that weekly jobless claims surged to 965,000 in the latest week, reaching the highest level in five months. Continuing unemployment claims rose to 5.271 million, up from 5.072 million in the previous week.

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