We've had an unprecedented three consecutive years now where inflation has remained higher than the 10-year UST yield on an average annual basis, and our hapless FOMC looks set to make it four

 There were just two years of this in the 1970s inflation, and they too were consecutive.

Anyone who calls Jerome Powell an inflation fighter is an idiot, or a stooge for the status quo of inflation profiteers.

This is all on the backs of the people, but where is the angry mob?

So medicated, so drugged, and so otherwise anesthetized by bread and circuses that the elites don't even bother to hide the truth.

 

Core inflation higher than DGS10 yield in 2020, 2021, 2022 (annual average)

Core inflation higher than DGS10 yield January through July 2023 (monthly view)

European Central Bank hikes main interest rate to 4% with core inflation running at 5.3%

 Story.

Yeah, that'll work.

Oil market reports suggesting tighter supply and higher prices through the rest of the year and beyond have fueled inflation fears; 

Overall inflation reversed course and ticked higher in August 2023 on a monthly jump in overall energy prices

 Overall inflation jumped up to 3.7% year-over-year and 0.6% month-over-month on a 5.6% jump in overall energy inflation month-over-month in August 2023.

Month-over-month, electricity was up 0.2%, gasoline was up 10.6%, piped utility gas was up 0.6%, fuel oil and other fuels were up 8.4%. Meanwhile food was up 0.2%.

Core inflation (overall inflation less food and energy) increased mom 0.3% and is still running 4.4% yoy.

Services inflation is still running high at 5.4% yoy, less rent of shelter at 3.1% yoy.

Shelter inflation rose mom 0.3% in both measures, and 7.2% yoy seasonally adjusted.

Going forward I expect inflation pressures to persist because of Biden administration green energy fantasies and hatred of fossil fuels combining with OPEC+ production cuts continuing indefinitely. 

Scandalous: Core inflation has been running ahead of the 10-year US Treasury for an unprecedented 3-years and 5-months, and everyone just shrugs

 

The Fed left the Funds Rate unchanged yesterday, and no members of the Federal Reserve Board currently anticipate a rate lower than at present through the end of the year

 They anticipate higher, but not by much, which means more rate hikes this year.

The yield curve aggregate yesterday closed just 4 basis points lower than the current cycle high of 4.674% achieved on March 8th, at 4.671%. That's the sum of the basis points for all US Treasury securities marketed yesterday divided by 13 (ranging from 1-month securities to 30-year).

To say the Fed's response to inflation has been timid would be an understatement.

In the 1980s the Fed's response to core inflation such as we experience today at 5.3% year over year was a Fed Funds Rate in excess of 10%. We're at 5.08%. The yield curve is not steppin' and fetchin' when the big dog won't bark.

This is not a serious country, and is perversely more than willing to inflict the worst tax on all, namely inflation, mostly because the whole damn economy is predicated on 2% inflation, which halves your nestegg in 35 years.

At 5% it does that in just fourteen.

It's criminal.

Core inflation has been above 5% year over year for 16 months, overall inflation at or above 5% for 22 months

 

Inflation remains a big problem in today's Consumer Price Index data

Services inflation is driving inflation now, 7.6% year over year in February. In a primarily service economy that's deeply serious. Wage and salary increases have penetrated deeply into everything, driving up the cost of using the services those people provide.

Electricity inflation is running at 12.9% year over year. 

Food inflation is still running at 9.5% year over year.

Overall core inflation in this data is at 5.5% year over year, more than double than under Trump.

Year over year in December, broad inflation is down for six consecutive months, core inflation is down three consecutive months

 

But there's still a long way to go to get to 2-ish percent in either category.

The Fed Funds Rate will be kept higher for longer.

CNN thinks November core inflation at 4.7% yoy is good news

There's never any discussion about how core inflation vaulted to the current levels well before the war in Ukraine even began.

The reason for the inflation surge is Biden's war for green energy, the one input which makes everything cost more because green energy costs much more than conventional energy from coal, oil, and natural gas.

Add trillion$ in COVID stimulus chasing too few goods and it's a recipe for the disaster which is ongoing, not moderating.

Some people get it. Most don't.

 

 

 

The Fed's Favorite Gauge Shows Price Increases Are Moderating

Another inflation report is out, the data are bad, but they're trying to spin it that inflation is moderating

 The government's chief inflation measure, so-called core inflation which excludes food and energy (third graph), ticked down to 6% in November. Big whoop. Core inflation has now averaged 6.3% throughout 2022, and was actually slightly lower year over year for two months in the summer than it was in November.

The Fed is failing in its effort to bring inflation down, plain and simple.

Higher prices are the new normal.

Meanwhile food inflation is up 12% year over year after peaking above 13% in the summer. Under Trump food inflation was practically non-existent, but Americans have been forced to cope with it month after month for over a year now, with no end in sight.

And energy inflation year over year has been north of 13% for 21 consecutive months. Go ahead. Count 'em. Under Trump we actually had energy disinflation because his administration, unlike Biden's, enthusiastically supported fracking.

Rising food and energy costs are absolutely core, especially when they deliver a one-two punch to the gut like this.

The people hardest hit don't have a voice, however. They never do. The chattering classes are doing just fine, and all they want to talk about is nonsense. Their lot is with the profiteers from inflation, not with the bottom half of the country.

The poor get poorer.

Same as it ever was.

Food and energy are bad enough, which core inflation would you rather have?