Thoughts on the latest CPI and what it means for my watchlist
The latest CPI print came in a bit hotter than expected, and while not a complete shock, it's definitely giving me pause regarding some of the growth names I've been eyeing. For the last few weeks, I've been leaning into the idea that the Fed might be nearing the end of its tightening cycle, which had me looking at more rate-sensitive sectors. Now, with inflation showing stickiness, I'm reconsidering the timeline for any potential rate cuts.
My watchlist has a few names that thrive on lower rates, and I'm currently thinking about rotating some of that attention towards sectors that might be more resilient to a prolonged period of higher-for-longer, or at least less sensitive to rates. Seeing $EMXC up 0.96% today, even with the CPI news, is interesting – maybe international markets are already pricing in a different dynamic, or perhaps it's just sector rotation. I'm wondering if others are adjusting their positions or watchlist criteria based on this data, or if you see this as more of a temporary blip.
Yeah, that CPI definitely throws a wrench in the works. I was also starting to eye some of those rate-sensitive growth stocks, assuming a dovish pivot was closer. Now I'm wondering if we see a prolonged period of higher rates, and what that does to valuations.