CPI just came in hotter than expected — and not in a good way.
Headline hit 3.7% vs 3.6% expected. Core landed at 2.6% vs 2.5% expected.
What makes this worse: expectations were already elevated after August's print. So these misses mean inflation ran even hotter than the *already higher* baseline the market had priced in.
Gasoline alone drove over 50% of the headline CPI increase. Energy's still the swing factor — but the core miss is what matters for Fed pricing. If core's sticky above 2.5%, the "higher for longer" trade stays live and risk assets stay under pressure.
Watch how gamma and vol respond into the close. If dealers are short gamma here, any move gets amplified. This kind of data tends to flush out weak longs before the real repricing starts.
Headline hit 3.7% vs 3.6% expected. Core landed at 2.6% vs 2.5% expected.
What makes this worse: expectations were already elevated after August's print. So these misses mean inflation ran even hotter than the *already higher* baseline the market had priced in.
Gasoline alone drove over 50% of the headline CPI increase. Energy's still the swing factor — but the core miss is what matters for Fed pricing. If core's sticky above 2.5%, the "higher for longer" trade stays live and risk assets stay under pressure.
Watch how gamma and vol respond into the close. If dealers are short gamma here, any move gets amplified. This kind of data tends to flush out weak longs before the real repricing starts.