- April’s inflation figures came in hotter than expected, and there are plenty of signs suggesting tomorrow’s report on May CPI will only add to that trend.
- Single most important factor in reining in inflation is the public’s confidence in the central bank’s willingness and ability to make it happen.
- Furthermore, markets are not only pricing in a rapid return to normal in inflation; they are assuming that a terminal fed funds rate of less than 4% will get it there.
For further details see:
Markets Have Bought The Fed's Transitory Narrative Hook, Line And Sinker, Part Deux