The labor market just made the Fedâs job harder. đ
August NFP came in stronger than expected at 162K, while unemployment held at 4.1%.
That tells me the economy isnât showing enough weakness to force the Fedâs hand toward easier policy.
But now inflation takes center stage.
August PPI came in hot at 0.4% MoM and 5.4% YoY, while rising energy prices could add even more pressure.
So Iâm leaning slightly risk-off heading into CPI.
A hotter CPI â especially a sticky core print â could push rate expectations higher, lift Treasury yields and strengthen the dollar. Thatâs not exactly the setup stocks and gold want.
But hereâs where it gets interesting.
If CPI comes in cooler than expected, the entire narrative could reverse almost instantly.
Markets donât trade the number alone.
They trade the surprise.
Hotter than expected = potentially bearish.
Cooler than expected = potentially bullish.
For now, Iâm not picking a side.
Iâm watching the gap between CPI and expectations.
Thatâs where the real volatility could start. đ
#CPIWatch
$RAYSOL
$KOMA
August NFP came in stronger than expected at 162K, while unemployment held at 4.1%.
That tells me the economy isnât showing enough weakness to force the Fedâs hand toward easier policy.
But now inflation takes center stage.
August PPI came in hot at 0.4% MoM and 5.4% YoY, while rising energy prices could add even more pressure.
So Iâm leaning slightly risk-off heading into CPI.
A hotter CPI â especially a sticky core print â could push rate expectations higher, lift Treasury yields and strengthen the dollar. Thatâs not exactly the setup stocks and gold want.
But hereâs where it gets interesting.
If CPI comes in cooler than expected, the entire narrative could reverse almost instantly.
Markets donât trade the number alone.
They trade the surprise.
Hotter than expected = potentially bearish.
Cooler than expected = potentially bullish.
For now, Iâm not picking a side.
Iâm watching the gap between CPI and expectations.
Thatâs where the real volatility could start. đ
#CPIWatch
$RAYSOL
$KOMA