🔥 CPI JUST CHANGED THE FED GAME
August CPI came in at +0.4% MoM and +3.4% YoY, while Core CPI rose 0.3% MoM and eased slightly to 2.4% YoY.
The important part isn't just the headline.
Energy prices jumped 2.1% in one month and 16.3% YoY, while the latest labor report showed +162K jobs with unemployment holding at 4.1%.
That creates an interesting macro setup:
- Strong labor market + sticky inflation = less room for the Fed to be dovish.
- The Fed held rates at its previous meeting, but three policymakers already voted for a 25bps hike. With inflation still above the 2% target, I believe the probability of another hike has materially increased.
📊 My market view
- Short term, this is potentially bearish for risk assets.
If markets price a more hawkish Fed:
Rate expectations ↑ → Treasury yields/USD ↑ → liquidity pressure ↑ → Gold & Crypto face resistance.
But I wouldn't automatically turn bearish on gold.
A large part of headline inflation is being driven by energy. Persistent inflation and macro uncertainty can eventually strengthen gold's role as an inflation and defensive hedge.
So my positioning is:
🟡 Gold: cautious short term, bullish medium term
$BTC : expect volatility; avoid chasing until the market absorbs CPI
💵 USD/Yields: key confirmation of whether the market truly prices a more hawkish Fed
For gold, I'm waiting for the first CPI volatility to settle before looking for a cleaner entry rather than chasing the initial move.
September FOMC just became much more interesting.
HIKE or HOLD? 👇
#CPIWatch
August CPI came in at +0.4% MoM and +3.4% YoY, while Core CPI rose 0.3% MoM and eased slightly to 2.4% YoY.
The important part isn't just the headline.
Energy prices jumped 2.1% in one month and 16.3% YoY, while the latest labor report showed +162K jobs with unemployment holding at 4.1%.
That creates an interesting macro setup:
- Strong labor market + sticky inflation = less room for the Fed to be dovish.
- The Fed held rates at its previous meeting, but three policymakers already voted for a 25bps hike. With inflation still above the 2% target, I believe the probability of another hike has materially increased.
📊 My market view
- Short term, this is potentially bearish for risk assets.
If markets price a more hawkish Fed:
Rate expectations ↑ → Treasury yields/USD ↑ → liquidity pressure ↑ → Gold & Crypto face resistance.
But I wouldn't automatically turn bearish on gold.
A large part of headline inflation is being driven by energy. Persistent inflation and macro uncertainty can eventually strengthen gold's role as an inflation and defensive hedge.
So my positioning is:
🟡 Gold: cautious short term, bullish medium term
$BTC : expect volatility; avoid chasing until the market absorbs CPI
💵 USD/Yields: key confirmation of whether the market truly prices a more hawkish Fed
For gold, I'm waiting for the first CPI volatility to settle before looking for a cleaner entry rather than chasing the initial move.
September FOMC just became much more interesting.
HIKE or HOLD? 👇
#CPIWatch
