CPI stays within expectations but still above target. CPI is up 4.1% YOY which is slightly less than last month but way above the average for the last fifteen years. CPI ex food and energy was within expectations at 2.4%. The level is similar to what we say in the beginning of 2006 when we saw a sustained bond market sell-off. We also saw a tightening Fed who was interested in inflation. Times have changed and the Fed is willing to take higher CPI in order to boost growth.
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