The market’s getting a pep talk… and a warning
Eddie Ghabour is basically saying: sure, CPI looks friendlier, but don’t start throwing the confetti just yet. He’s surprised the 10-year Treasury yield hasn’t budged much, and he thinks the Fed still has a long road ahead before it can call the inflation fight finished.
Why investors should care
If the Fed keeps its hand near the brakes, that can keep a lid on the kind of risk-on party stocks love. A calmer CPI print is nice, but it doesn’t automatically mean lower rates, easier financial conditions, or a smooth ride for the broader market.
Jackson Hole: the next plot twist
The real spotlight is the end of August, when Ghabour expects Fed Chair Kevin Warsh to signal tightening at Jackson Hole. That’s the kind of thing traders obsess over because a few words from the podium can whip up bonds, rotate money out of rate-sensitive names, and turn a “healthy” rally into a very opinionated tug-of-war.
Big picture
The headline is simple: inflation may be improving, but the market is still living in the Fed’s house rules. And until policymakers sound more relaxed, every rally has to answer the same annoying question: is this the start of something bigger, or just a nice bounce with a chaperone?