Brilliant. The Fed declares that broader price pressures are caused by broader price pressures.
What you're not hearing about the flat yield curve
Tuesday, March 22, 2022
It's the worst business cycle indicator out there (other than Jerome Powell).
Update to Strategic View
Powell's rhetoric is more hawkish than ever, and the Treasury curve is almost flat. The last 6 recessions were preceded by inversions of the 2-10 curve, but the inversions came too early to be useful -- on average, 19 months before the next business cycle peak, causing investors to miss out on 12% equity rallies. Today's curve is distorted by transitory inflation expectations pushing up short-term yields far more than long-term yields. The 2-10 curve is actually almost 2% steeper than it appears.