May. 12 at 9:06 PM
April inflation was not just hot — it was household-squeeze hot. CPI rose 3.8% year over year and 0.6% month over month, with gasoline, groceries, rents, and airfares all pushing higher, while Reuters noted real wages fell as inflation outpaced pay growth for the first time in three years.
Tickers:
$TLT $XLP $WMT
Our view is this is more damaging than a normal inflation beat because it hits both sides of the macro equation at once. Consumers are losing purchasing power just as the Fed has less room to cut, which means the next leg of market stress may come less from headline shock and more from slower real spending under sticky inflation.
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