The Macro Minute: September CPI Revives Inflation Concerns
Darius Dale says September CPI strongly challenges expectations for slowing inflation, with several CPI measures supporting his view that inflation remains sticky. He concludes that a risk-off inflation regime is likely to persist and may deepen, while arguing that modest Fed tightening should continue until officials present a credible plan to cap bond yields.
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Dale says September CPI strongly challenged the consensus forecast of slowing inflation, and he expects the risk-off inflation market regime to persist and potentially deepen in the coming months.
Dale argues that the Fed does not need aggressive rate hikes, but should continue modest tightening until Bessent, Zeros, and Warsh introduce a credible plan to cap bond yields through Fed Treasury Accord 2.0.
Dale says China is ahead of the United States in 66 of 74 critical technologies, according to the latest tracker he cites.
September CPI And Fed Policy
Darius Dale says September CPI challenges expectations for slowing inflation and supports a sticky-inflation outlook, while arguing for modest Fed tightening until officials offer a credible plan to cap bond yields.
China, Ukraine, And Fiscal Risks
Dale reviews China's technology position, Starlink's Ukraine service disruption, Chinese credit data, and projected Social Security trust fund depletion, which he sees as part of a broader outlook for redistributive policies and a secular bear market.
Quantitative Risk Management
Dale urges investors to use quantitative risk-management tools rather than rely on feelings, which he says can amplify cognitive biases and lead to costly investment mistakes across market cycles.
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