Is the US slippin’ into darkness? It is, according to core inflation slipping to 1.55% YoY compared to The Fed’s target rate of 2.0%.
Declining core inflation translate to a flattening Treasury curve.
And a tanking volatility cube at the short-end.
The expectation for a rate hike on May 1st is … 0!
But the forward curve (orange line) for Fed funds rates is decidedly downward sloping.
Let’s see if Fed Chair Jerome Powell signals economic optimism for the US while the market is signaling slowdown.
Thanks to Jesse at Jesse’s Cafe Americain!