Stocks Tank & Yield Curve Inverts After Hotter-Than-Expected CPI Print

Well that’s not what the market wanted to see…

The hotter than expected CPI print has sparked turmoil in markets with the Treasury curve inverting once again (now its most inverted in over 2 months)…

With 30Y Yields still lower on the day as 2Y soars 14bps…

Stocks are accelerating their losses from yesterday. almost completely erasing the post-Bostic-Pause short-squeeze ramp…

Rate-hike expectations are soaring to their highest during this cycle with the market expecting Fed rates at 3.00% by year-end…

Notably, at the same time, subsequent rate-cut expectations (as the recession hits) are also soaring.

The dollar is spiking near one-month highs…

As Miller Tabak’s Matt Maley notes: “This stronger-than-expected inflation data pushes out the time frame for peak inflation and it gives the Fed the green light to continue with their aggressive tightening policy. I’d also note that the drop in the 10-year yield on this data and the flattening of the yield curve is a signal that markets are seeing stagflation as an even bigger problem.”