December CPI In-Line

CPI was right on the screws with expectations at -0.1% on headline and +0.3% core. But the details do paint a picture of lingering pressures at the core. Core services rose by 0.5%, up from the 0.4% in November. Owners’ equivalent rent rose by 0.8%, the highest...

Central Bank Tightening, International Version

Bank of Japan (BOJ) Finally Flinched   BOJ made a decision to double the trading band of the 10-year Japanese government bond. We believe the move is justified. It may mark the start of a gradual shift away from the strict bond yield controls emblematic of...

A Rant on the Yield Curve Inversion

Where Does the Terminal Rate Need to Go?    Source: Bloomberg. As of 11/18/22.    It’s pretty clear the pace of rate hikes will slow down soon, although we believe we are far from returning to the easy money policy experienced the last 10+ years. Given the...

A Good Day for The Fed

Year-over-year, CPI rose 7.7%, down from the 8.2% pace reported the month prior and the fourth consecutive month of cooling price pressures, albeit still near a four-decade high. It rose 0.4% in October, less than the 0.6% gain expected and following a similar...

Thoughts on Interest Rates

We’ve had a number of questions regarding peak interest rates. Interest rates have of course been a hot topic in 2022… the 4th worst year for government bonds since 1721 has led to an interesting backdrop of uncharted waters. Interest rates can be confusing, and we’ve...