All sorts of commentary today that the drop in CPI...below expectations for the first time in a year...somehow proves Powell correct. Namely, that inflation is/was indeed "transitory". Well, as the old ball coach likes to say, "not so fast, my friend".
And we've been stating this here for weeks, too. Yes, of course inflation would eventually stabilize. However, "transitory" means that you believe it's now going back to 1-2% annualized. Two things:
- Inflation is not going back to 1-2% annualized...though it may trend back toward 3-5%.
- But the damage is...