We have our inflation print. Cause for celebration, perhaps.

The year on year looks bad, across both headline and core.


But importantly, month on month data is showing a much more comforting moderation, of consecutively lower prints.


In other words, some of the year on year data is base effects from stuff that happened at the back end of the time period, and isn’t telling us much about current conditions. Arguably, the peak is in.

Maybe even more simply: just as everyone reaches the frothing stage of worry, we begin to sequentially roll over.

The Fed is looking for or at 1994 analogies, in terms of financial channel tightening conditions/objectives. Stocks survived, and went on to great things, but certainly had a bumpy time of it. Most other tightening cycles were quite okay for stocks, in the 2yrs post lift-off.


Equity markets typically have sizeable intra-year drawdowns, regardless, each year every year. So looking at 5 or 6 historical examples has a lot of noise that clouds whatever signal you think you are extracting. But still.

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