News about Inflation

The Prices Paid component of ISM Manufacturing has moved up to its highest level since June 2022, potentially signaling higher inflation for longer. This was a leading indicator of the inflationary spike in 2021-22 and the cooling of inflation in 2022-23. pic.twitter.com/HuWXBQckHc

🇺🇸 #Fed Flags Lack of #Inflation Progress But Signals Hikes Unlikely - Bloomberg www.bloomberg.com/news/articles/2024-05-01/fed-cites-lack-of-progress-on-inflation-holds-rates-steady?sref=ZVajCYcV pic.twitter.com/2HYADgXiSq

Instead of focusing on the ISM Services Index plunging into #recession territory, with pronounced weakness in employment, investors focused on the surging prices paid component. They missed the point that #recession will prevent the #Fed from raising rates to fight #inflation.

A weaker than expected April #jobs report caused speculators to pile into risk assets. This reaction misses the point that #stagflation isn't good for risk assets. #Inflation will run out of control as #recession wides budget defects, weakens the dollar, and sidelines the #Fed.