CPI YoY Tumbles, FRB Getting Soft in Minutes

Nasdaq level to watch

Today’s CPI is confirming the collapse in inflation as YoY tumbles by 1% from 6% last month to 5.0%. Core CPI was up 0.4% MoM (exp. 0.4%),lead by a continued increase in shelter expense. Shelter expense is by far the stickiest of the inflation metrics as picking up and moving out of a given area is not easy and it is generally a last resort option as there are many factors that go into this, mobility, flexibility in regards to commute, schools, kids etc. There is a lot that goes into that, however we do feel that as the economy sours, this will be a forced issue that many are going to have to deal with.

As far as the market reactions, well, someone in the fixed income world bid up bonds and tens prior to the release, just seconds prior actually as shown here from Zhedge:

Source: Zerohedge