CPI Data is Rearview Mirror.
...pricing pressure precedes CPI by a year, which is why the Fed doesn't look at it in making policy.
That said, war or the prospect of war is exceptionally inflationary. So what happened this past week?
Well we're supposedly on the door step of nuclear war and inflation expectations did nothing at all!
It was growth, not inflation which was crushed this week!
This tells me Korea was the excuse to sell, not the cause.
The proof of this would be if tensions lessen and the market doesn't come roaring back.
Talk now is more protectionist towards China trade, which again, would be exceptionally inflationary...so we'll see how the market digests the prospects of a trade war.
