#CPIWatch
Six days. That's how long Fed Chair Kevin Warsh has to reconcile two signals that are telling him completely different things.
Nine days ago, nonfarm payrolls didn't just beat expectations they tripled them. 162K jobs added in August against a forecast of roughly 53K, unemployment steady at 4.1%. Numbers like that don't wander in quietly. They rewrite rate-hike odds overnight and send every desk on the Street back to their FOMC math.
Now the second signal lands today: August CPI, out at 8:30 AM ET, the last inflation print Warsh's committee sees before the September 16 decision. Consensus has headline holding at 3.4% YoY and core easing to 2.4% from 2.5%. After a hawkish Jackson Hole speech and an in-line PPI on Thursday, CME FedWatch has hike odds parked north of 60% and climbing every time the labor data refuses to cooperate.
Here's my read: a jobs report that strong doesn't get walked back by one CPI print. If today's number lands anywhere near or above consensus, I think the hike is close to locked in yields grind higher, the dollar follows, and that's usually a headwind for gold and crypto in the short run. A genuine downside surprise on core is the wildcard that's the version where Warsh gets cover to hold, and where I'd expect BTC and gold to catch a real bid. I'm leaning toward the hike scenario, but a print this binary isn't one I'm betting the account on sizing down until the number's actually on the screen.
#CPIWatch #CryptoAnalysis
Six days. That's how long Fed Chair Kevin Warsh has to reconcile two signals that are telling him completely different things.
Nine days ago, nonfarm payrolls didn't just beat expectations they tripled them. 162K jobs added in August against a forecast of roughly 53K, unemployment steady at 4.1%. Numbers like that don't wander in quietly. They rewrite rate-hike odds overnight and send every desk on the Street back to their FOMC math.
Now the second signal lands today: August CPI, out at 8:30 AM ET, the last inflation print Warsh's committee sees before the September 16 decision. Consensus has headline holding at 3.4% YoY and core easing to 2.4% from 2.5%. After a hawkish Jackson Hole speech and an in-line PPI on Thursday, CME FedWatch has hike odds parked north of 60% and climbing every time the labor data refuses to cooperate.
Here's my read: a jobs report that strong doesn't get walked back by one CPI print. If today's number lands anywhere near or above consensus, I think the hike is close to locked in yields grind higher, the dollar follows, and that's usually a headwind for gold and crypto in the short run. A genuine downside surprise on core is the wildcard that's the version where Warsh gets cover to hold, and where I'd expect BTC and gold to catch a real bid. I'm leaning toward the hike scenario, but a print this binary isn't one I'm betting the account on sizing down until the number's actually on the screen.
#CPIWatch #CryptoAnalysis
