Understanding the Truth About Inflation: Explaining the Latest CPI Report | Market Takes

Inflation is still much higher than the Fed’s target and economists are warning it may be stickier than markets are expecting. The Federal Reserve has said it will be data dependent moving forward and the CPI report is the most pivotal piece of data it will examine. We’ll examine what the April CPI showed and explain what matters for markets and the economy.

Market Takes is a stripped-down and straight-up livestream where I'll cut through the noise and break down the week's most important market trends, reports and economic data. Tune in to understand what will be moving markets each week and why.

I’m Dion Rabouin, a WSJ reporter covering markets and the economy. I’ll be diving into all things finance, from the popular and well-known — like crypto and stocks — to the complex and intricate — like leveraged loans, derivatives and private equity. Subscribe to join me as I take a deep dive into what’s making money move and why it matters.

#Inflation #Markets #DionRabouin

[DionRabouinWSJ]

What do the numbers in the April CPI report tell you about the current state of the U.S. economy?

[haydenwires]

Fantastic content. You articulate this complex stuff in a way that even I can understand. Thanks for making this, keep it up 🙌🏼

[mgnfcnt]

Awesome job Dion!! Thank you as always 🙏🏽

[Anti-socialSocialClub]

So to reduce inflation, the government needs to control corporate profits.

Maybe they should create a windfall tax on super profitable companies and reduce is as inflation reduces...

[spacetoast]

It's concerning that core inflation is so sticky. It seems like rate hikes need to keep coming until unemployment goes up significantly. The Fed also needs to maintain their credibility by keeping rates up.

I don't know why so many people expect rate cuts so soon.

[leehayes]

Thanks for pointing out corporate margins.

Waiting until june to see where the market goes!

[mcfnord]

I respected WSJ for reporters like you. WSJ printed a letter from a dishonest president without criticism that I expect from a healthy press. So I cancelled WSJ. But they have some of the best reporters in the world!

[MSL-sh]

Saw you on The Compound... I subscribed to your page 💯

[abbottmd]

I found you through compound and friends and immediately subscribed, great content!

[wilhelmvanbabbenburg]

So basically companies are helped with tax money in times of crisis, but as soon as they have the opportunity, they squeeze consumers, so us... They raise prices, but do not want to raise salaries.

[amirsafayan]

Just watched you on the @TheCompoundNews and subscribed to your YouTube channel. Imagine what the impact to the shelter component of CPI will be when real estate tax assessments, which are backward looking, are factored in. I've just received my assessments ( which will be in effect for the next two years ) and they are absurdly high. It's the definition of "stickiness" because it's basically bringing forward the COVID real estate price bubble.

[bobbyomari]

This data is cautiously optimistic but I disagree with the market’s sentiment that there should or will be a pause. We should continue to increase rates by another 25BP because the second there is a pause or a cut, inflation will peak its head again. With unemployment still incredibly low and the job market very tight, people are willing and able to spend money . Fed needs to keep their foot on the gas with rate increases and handle any bank failure, case by case. Most Americans would prefer lower/normal costs for goods and services vs keeping the stock market and its shareholders happy. Thanks for the update, Dion!

[BologneseBucket]

How often is the representative basket for CPI updated? I was wondering if CPI inflation has decreased because consumers substituted away from products that increased in price but we'd need a new representative basket to know if what consumers are now consuming is still increasing in price.

[themissingtile]

Shout out to you DIon. What's good?

[notsodelusional]

I'm not sure how realistic it is to expect rate cuts unless CPI and especially core CPI is in the low 3s. But hey, I don't get paid the big bucks to make random ass guess.

Let's see how sticky inflation is (or is not). At the very least, we can tell the people who keep claiming that the upcoming recession will be worse than 2008 to shut the hell up.

Great work as always, Mr. Rabouin.

[locn]

The all powerful force vs the immovable rates.

[VictorAntares]

why are markets so bullish on the Fed loosening policy when they've demonstrated that they've been slow to react in the past? I know their tenor has lightened up recently, but...

is it worth jumping on this take too early and possibly taking an L? or getting on too late and missing the boat?

[TheWealthElevator]

it seems that the Fed may pause in June and then start cutting rates again. The Fed funds futures market (what those who have skin in the game are betting) are indicating an increasing likelihood of a rate cut in July, with a 36% chance of that happening. If we look further ahead to September, there is a 22% chance of two rate cuts happening. Of course the FED has been tight lipped about all this.

[JigglyPuffMafia]

Inflation isnt coming back down to 2% this year.... were at 4.9% CPI and the banks are already collapsing.

[SportyGeek]

100% chance they don't cut rates 3 times by the end of the year. Bet.