The new goal is 2 percent inflation over the long term. Mathematically you will have to bring inflation below 2 percent for 6 or 7 years just to average 2 percent over the long term thanks to the post Covid spike. If you grew up in the 70’s and 80’s you know what bad jobs market looks like. This ain’t one. IMO

Lower rates increase the economy. Trumps white house is printing money and pushing for lower rates. Inflation should increase if that happens. Peoples investments should keep booming. I'm guessing the new Fed chair in May has some plans.

Tangible > Numeral

everything require petrol to produce or move

inflation/prices will be going up....

I don't think we'll be seeing rate cuts anytime soon.....

Absolutely, we witnessed that jyst A few years ago.

To see how oil price and inflation go hand in hand, compare these two charts.

There are other factors, but these two run pretty close together..

https://www.chartoasis.com/crude-oil-per-barrel-commodity-chart-5-years-cop2/

https://www.usinflationcalculator.com/inflation/current-inflation-rates/

My head hurts.

Rates held steady.... as expected.

The cost of living index went up .7% in February. The largest monthly increase in several months and that does not include any of the increases in March which will be substantial. We are seeing the real impacts of year old tariffs, now. So all of us that belive a 3-6 week pump in energy costs will disappear by the 4th of July do not understand how our economy works. Businesses are spending billions more for goods and services that will be in our economic future for many months. Long term things like fertilizer. Most fertilizer has been purchased for 2026, but the cost for 2027 has already gone way up It is not just the cost of the fertilizer used per acre it also shows up as less is used and that can trigger lower yields and thus shorter supplies. Corn has already gone up .25 cents since March 1st and we still have a 2 billion bushel carryover but users know and feel there could be some real supply concerns heading our way even without weather etc. Fertilizer issues impact all major crop countries, like Brazil, China, Ukraine, Argentina, India etc.

Bryce

I heard Kevin Warsh wants to reduce cash in circulation and destroy it, if someone has heard different please correct me.

It actually is nice to finally see some volatility come into the markets it creates some good buying and selling opportunity.

It actually is nice to finally see some volatility come into the markets it creates some good buying and selling opportunity.
Yes there are 3 March 2027 futures over $5.00 for corn. Been a while since those prices were around, but with fertilizer up about 30% right now and average costs would be say $100 per acre that is another $25-$30 or for good IA corn ground about 15 cents per bushel which means some additional income but that does not include the higher costs of other inputs such as fuel other fertilizers and chemicals which are largly petrolium based.
I can see some larger end users buying now even with 5 cents per bushel per month or 60 cents per year that means corn at $5.25 next year is break even for them and they have their supply. We have not dealt with a smaller crop for a while and it may get real interesting if we break away from typical acres planted and yield trends.

Bryce

Maybe it is me, but wouldn't you want to make a move to counter inflation to keep the money value stable or declining to your goal, not after the inflation happens away from your goal?

I'd be interested in knowing where you heard that.

Warsh has said he wants to reduce the Fed's balance sheet, which by itself makes sense to me. That should have the effect of reducing liquidity and raising rates slightly.

But at the same time I suspect he wants to cut actual short term rates to satisfy his boss. The two things MIGHT be possible but would likely take years to accomplish.

I can't imagine he supports eliminating cash entirely. I also think any move in any of those directions will create an outcry in both the credit and equity markets.

He can't do much of anything on his own.

"The Fed’s traditional playbook is that when there is tension within its dual mandate of stable prices and maximum sustainable employment, it leans toward containing inflation. Stable prices, after all, are a precondition of full employment."



"Fed officials “are aware they’ve missed their inflation target for five years, and they do not want to continue to miss it indefinitely,” said Nathan Sheets, chief economist at Citi and a former top economist at the Fed. Inflation, according to the Fed’s preferred measure, was 2.8% in January, up from 2.3% nearly a year ago. It’s also above the Fed’s target of 2%."

Love it or hate it, the Iran War--or whatever it is causing financial instability.
Oil Prices are up 73% YTD.
Love them or hate them, tariffs created significant issues.
Inflation is not under control.
Growth has slowed to almost nothing.

The S&P and Dow are down approximately 4-5% YTD.

From what I can see, average consumers are feeling it worse than is being reported.

2026 didn't have to be this hard.

I could be dead wrong but I don't think oil prices will remain elevated for an extended period. The world is awash in oil and the current price spike is logistics. The transporters will find a way to get the needed oil to market. Until the United States begins to decline from record production of the last few years, oil price increases will be short lived.

True if the Iran thing doesn't last to long, also the market will rebound huge once it's over.