It’s hard to know how much signal to take from inflation last year, or this quarter, or last couple of weeksI didn’t quite get more confidence in Q1 this year about inflation, we’ll see where we goOn the goods side, I hear pricing power is waningThis month’s inflation reading was very encouragingLabor market is also heading in the right directionThe hiring rate has dropped a lotI’m watching closely if we’re going to see an accelerationThe dynamic underpinning spending is a strong jobs market and a stock market at record levelsConsumer spending is still solidIt’s not hard to see scenarios where the labor market weakens
US 5-year breakevens are at 2.16%, the bond market has already decided that inflation is over.
This article was written by Adam Button at www.forexlive.com.
