Thread by @C_Barraud

🇺🇸 #Fed Update (1) | PCE #inflation rose 5.0% YoY (highest since Nov. 1990; vs 4.4% prior).
*Core was 4.1% YoY (highest since Jan. 1991; vs an upwardly revised 3.7% prior).

🇺🇸 #Fed Update (2) | FOMC minutes revealed that once again, doves were completely wrong about #inflation noting that “the most sizable price increases may have already occurred.”
*Link (p.8): federalreserve.gov/monetarypolicy…

🇺🇸 #Fed Update (3) | That view was proved wrong by the CPI reading released a week later and the PCE inflation figures released yesterday.

https://twitter.com/C_Barraud/status/1463809067902803968

🇺🇸 #Fed Update (4) | As I already noted, on a YoY basis, core #inflation is unlikely to soften in the short term because of spiking #rents.

https://twitter.com/C_Barraud/status/1462084588352774154

🇺🇸 #Fed Update (5) | Earlier this week, Powell and Brainard made important speeches targeting #inflation.
*Link: bloom.bg/3nQhCRh

🇺🇸 #Fed Update (6) | With households using their excess savings and inflation still accelerating, the doves should enter the Dec. FOMC meeting with a “low profile” attitude.

https://twitter.com/C_Barraud/status/1463795723829493760

🇺🇸 #Fed Update (7) | Doves could be more inclined to accelerate tapering, opening the door to a rate liftoff in April or June (rather than in July).
*According to Bloomberg calculation, the liftoff is fully priced by June 2022.