12-month headline inflation peaks at 9.1%, core slows further to 5.9%.
Headline inflation in the backward looking CPI has peak at 9.1%. The more important Core CPI inflation, in contrast, has peaked in March at 6.5% and has fallen further in June down to 5.9% in the current print. Funny what the forget to tell you. We expect the monthly pace of inflation to slow notably over the remainder of the year. July and August CPIs should see core inflation falling to under 5%. The market is also ignoring the biggest drop in M2 money supply i have ever seen.
The Fed has slammed on the breaks and they are in panic mode. If they raise rates 100 bases points later on this month this will keep the tradition alive of over stimulation and then panicking and over tightening. Au contraire Inflation is not the crises…. Its the massive deflation they are creating as they panic. And we do deflation…..