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How Core Inflation Is Sticking Despite a Flat Fed Rate
Season 1
Episode 9
Published 1 month, 2 weeks ago
Description
The Fed has held the federal funds rate at 364 for months, but inflation isn't cooperating. In this episode, Lucas and Luna dig into the latest CPI and PCE data to understand why core inflation is still rising, what the bond market is signaling, and how the war in Iran is complicating the Fed's outlook. They discuss the gap between headline and core CPI, the 10-year breakeven inflation rate ticking up to 2.40%, and what that means for the neutral rate debate. With consumer sentiment at a record low and small caps surging, the hosts explore whether the economy is sending mixed signals—or just painful ones. Listeners will come away with a clearer picture of why the Warsh Fed seems stuck, even as prices creep higher.