US rising-inflation probability just cratered from 54% to 27% in a single month according to nowcasting data — even as headline inflation ticked up.
The second derivative is rolling over right where Warsh's breadth measure said it would.
This hiking cycle? It's going to be short-lived.
Market's pricing in peak hawkishness while the underlying inflation momentum is already fading. Classic setup for a pivot narrative to take hold faster than consensus expects.
Watch rate-sensitive sectors and duration plays closely. If this inflection holds, we could see a sharp rotation into growth, tech, and risk assets that got hammered during the tightening phase.
The Fed might talk tough, but the data's already turning. Don't fight the second derivative.
The second derivative is rolling over right where Warsh's breadth measure said it would.
This hiking cycle? It's going to be short-lived.
Market's pricing in peak hawkishness while the underlying inflation momentum is already fading. Classic setup for a pivot narrative to take hold faster than consensus expects.
Watch rate-sensitive sectors and duration plays closely. If this inflection holds, we could see a sharp rotation into growth, tech, and risk assets that got hammered during the tightening phase.
The Fed might talk tough, but the data's already turning. Don't fight the second derivative.
