Fresh inflation data just gave the market a clear signal: the Fed has room to cut sooner than expected.
PPI Snapshot (Actual vs. Forecast):
PPI MoM: -0.4% vs. 0.2% ✅
Core PPI MoM: -0.1% vs. 0.3% ✅
PPI YoY: 2.7% vs. 3.3% ✅
Core PPI YoY: 3.3% vs. 3.6% ✅
PPI ex Food/Energy/Trade YoY: 3.4% vs. 3.5% ✅
🧠 Prices aren’t just slowing — they’re contracting. Combined with soft CPI, this disinflation confirms a Fed-friendly trend and clears the way for policy easing.
🧨 The Twist: 10-Year Yield Spiked
Despite stocks falling, the 10-year yield moved up — a rare divergence in risk-off environments.
This likely reflects three key forces:
Hedge funds facing margin calls, forced to liquidate bond positions.
Political actors unloading treasuries amid U.S. fiscal tensions.
A potential counter-strike to Trump’s efforts to push yields down via market stress.
💡 Ironically, this may help the Fed. Rising yields tighten financial conditions on their own, giving Powell more space to act without risking an inflation resurgence.
🧭 Sector Playbook (Macro-Aligned)
Tech and Growth — Overweight. These sectors thrive on falling rates and an easing narrative.
Bonds — Accumulate. Yield spike could offer a prime entry point before a Fed pivot.
Crypto — Risk-On. Disinflation + volatility = breakout fuel.
Energy and Defense — Hold. May underperform in a growth-led rally (Besides nuclear).
Defensives — Underweight. Safety trade could unwind as liquidity improves.
Small Caps — Speculative. Could bounce hard if liquidity rotation begins.
⚠️ Final Thought
Markets are digesting short-term chaos, but underneath it all, the macro signals are aligning. Even without a "golden tweet," the inflation data is giving Powell the green light.
If the Fed wants to cut — the data is here. The only thing missing is confirmation from Powell’s tone.
#Disinflation #FedCut #YieldSpike #MacroUpdate #CPI #BondMarket #TradingViewIdeas #MarketOutlook #SectorRotation
PPI Snapshot (Actual vs. Forecast):
PPI MoM: -0.4% vs. 0.2% ✅
Core PPI MoM: -0.1% vs. 0.3% ✅
PPI YoY: 2.7% vs. 3.3% ✅
Core PPI YoY: 3.3% vs. 3.6% ✅
PPI ex Food/Energy/Trade YoY: 3.4% vs. 3.5% ✅
🧠 Prices aren’t just slowing — they’re contracting. Combined with soft CPI, this disinflation confirms a Fed-friendly trend and clears the way for policy easing.
🧨 The Twist: 10-Year Yield Spiked
Despite stocks falling, the 10-year yield moved up — a rare divergence in risk-off environments.
This likely reflects three key forces:
Hedge funds facing margin calls, forced to liquidate bond positions.
Political actors unloading treasuries amid U.S. fiscal tensions.
A potential counter-strike to Trump’s efforts to push yields down via market stress.
💡 Ironically, this may help the Fed. Rising yields tighten financial conditions on their own, giving Powell more space to act without risking an inflation resurgence.
🧭 Sector Playbook (Macro-Aligned)
Tech and Growth — Overweight. These sectors thrive on falling rates and an easing narrative.
Bonds — Accumulate. Yield spike could offer a prime entry point before a Fed pivot.
Crypto — Risk-On. Disinflation + volatility = breakout fuel.
Energy and Defense — Hold. May underperform in a growth-led rally (Besides nuclear).
Defensives — Underweight. Safety trade could unwind as liquidity improves.
Small Caps — Speculative. Could bounce hard if liquidity rotation begins.
⚠️ Final Thought
Markets are digesting short-term chaos, but underneath it all, the macro signals are aligning. Even without a "golden tweet," the inflation data is giving Powell the green light.
If the Fed wants to cut — the data is here. The only thing missing is confirmation from Powell’s tone.
#Disinflation #FedCut #YieldSpike #MacroUpdate #CPI #BondMarket #TradingViewIdeas #MarketOutlook #SectorRotation
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.