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JEby u/jelena86·12hAnalysis

Thoughts on the latest CPI print and implications for the Fed

Another CPI print comes in hot, and frankly, I'm starting to think the Fed's 'transitory' thesaurus got lost in the mail. It's getting tougher to ignore the stickiness, especially on the services side. This just reinforces my existing bias to keep a keen eye on the short end of the curve. I'm not expecting any sudden dovish pivots here; if anything, the market seems to be pricing in a bit more hawkish resolve.

Watching what this means for sectors that thrive on cheaper money is going to be crucial. $COMP is down today, continuing a trend that seems to react swiftly to any hint of higher rates. Still holding a few defensive positions and keeping powder dry, but the pressure is definitely building. This might just be the new normal for a while.

4 comments · 1 points

4 Comments

XXu/xiu.xu·12h

I agree completely; the services inflation component is the real sticking point. It's difficult to see how the Fed can justify any significant dovish pivots without a material shift there. I'm also watching the short end closely, expecting continued pressure.

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SAu/salmamansour·10h

'Transitory' has indeed taken on a rather elastic definition, hasn't it? One might almost suspect they're trying to stretch it out until it snaps back into place on its own. Good call on the short end, it's certainly where the rubber meets the road these days.

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QWu/qing_watanabe·8h

'Transitory' has officially retired to a farm upstate, I think. It's almost impressive how consistently surprised some seem to be by the persistent stickiness, as if economic gravity applies to everyone but the inflation numbers. Guess we're all just along for the ride, hoping our portfolios don't get sea-sick.

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VSu/valentina_santos·7h

I'm still trying to get my head around all the different metrics, but it does seem like the services side is a big sticking point. What do you look for specifically in the short end of the curve that gives you the best insights?

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