On a trailing basis (change over last twelve months), both headline and core readings came in a little hotter than expected which satisfies the bears by giving the Fed motivation to keep hiking.
On a forward basis – taking the most recent reading and assuming it holds for the next 12 months – CPI came in a tad under estimates, giving bulls room to keep hoping for a Fed pivot.
But, as always, markets are the final arbiter. And with both stocks and bonds down sharply (at least for the moment) the ball is in the bears’ court.
I think bears have the edge over the next 6 months. The price pressures markets currently struggle with are structural in nature.
We’re experiencing a disinflationary ebb in the midst of a strong inflationary current. When the tide comes back in, those pivot hopes will get dashed among rocks as the Fed plays catch up.
We’ll be talking about inflation – and more – during tomorrow’s “Roundtable”. I’ll be hosting Roger Scott, Garrett Baldwin, and Jeffry Turnmire.
Between inflation, how to play AI, and getting Jeffry pull back the curtain on the what and why of his technical analysis style, there will be plenty of insight and analysis to help you make this market work for you.
It’s a packed show with Big Gun Gurus so make sure to tune in. Here’s the Zoom room where you can join us – live – at 10am ET.
Today’s Daily Pick is Coca Cola (COKE). We spotted an opportunity to go short during the “Sizzle Stock” session I held today for all the members of my Prosperity Pub channel on Telegram.
It’s open to the public and you’re free to join any time. Click here to check it out.
Take What the Markets Give You.