Distinctly disappointing 13 October
The market responded as though it had received a nasty shock, with bond yields surging higher while stocks sold off.
An imminent Fed hike still looks unlikely — but evidently, many in the markets were hoping for any such chance to be extinguished.
Shelter Bostad inflation, on a year-on-year basis, is still above 7%.
All of the other components of the CPI, aggregated together as an index, come to exactly 2%.
Also, to give some reason for cheer, the spike in the price of eggs that caused much angst earlier this year is well and truly over.
So what was the problem?
The clearest reason for disquiet, I think, comes from the “supercore” measure that Fed Chair Jerome Powell has emphasized in recent months — services excluding shelter.
This category is heavily led by wage inflation, as labor is a large share of costs for such businesses. If the tight labor market was causing price pressure, this is where it would be.
In this context, the fact that September saw the highest month-on-month increase in the supercore since September of last year is distinctly disappointing
John Authers Bloomberg 13 oktober 2023
12 October 2023
Englund: Grön öppning 12 oktober (englundmacro.blogspot.com)
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