You are currently viewing Market Snapshot 2.13.23- Bonds Are Flat

Market Snapshot 2.13.23- Bonds Are Flat

Good Monday AM,

Bonds are flat with a bias toward weakening.

The ten year is sitting at 3.72%, which a key Fibonacci level. If we do not hold, we will run up to the next fib level which 3.84. At the moment, this is looking like a realistic possibility. Tomorrow we will get the CPI numbers. The market is quite amped as they should be, to see this number. The forecast is a rise of .04% which seems reasonable, but who knows? Nobody does. I would not be surprised to see us come out much higher or much lower. You should be careful floating because if the number comes in hot, this bond pull back will intensify.

This was a good piece from the WSJ.

Just a snippet below and the graph is really the focus and is why I continue to expect inflation to moderate on its own without any herculean effort. We are replacing historical months with higher inflation readings with current readings which have much less inflation.

The end of distressingly high inflation is coming into view. Consumer prices gained 6.5% in December, down from June’s 9.1% annual rate, the highest since 1981. There is good reason to think inflation will keep falling, Federal Reserve Chairman Jerome Powell said earlier this month. Even so, inflation is far above the Fed’s 2% target. Even excluding the volatile food and energy categories, core inflation was 5.7% in December. So how does it fall all the way back to 2%? Markets seem optimistic it will do so of its own accord, and are betting the Fed will therefore cut rates this year. Mr. Powell disagrees. WSJ’s Gwynn Guilford looks at the three sectors that will determine who is right: goods, shelter, and other services, excluding food and energy.

And this was interesting…

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Please remain safe and stay healthy, make today great!