The Fed is starting to play catch-up with inflation signals from the bond market as evidenced by the Fed Funds Rate finally being pulled upward by the implications of the rising 3 month T-bill yield, among other more obvious signals like the long since rising 2yr Treasury yield and ongoing inflation headlines we read about every day.
After the June FOMC meeting, an additional .5% hike will be in the bag as CME Group traders are forecasting.
But as noted in this post about the May ISM (manufacturing) and Payrolls, supply chains are ever more involved in the narrative. Captain Obvious wants you to know that an economic drag is being caused by the past and present COVID-19 shutdowns, the war in Ukraine, and increasing global political tensions and saber rattling. Continue reading "This Is Not Your Grandpa's Inflation Problem"