Deflationary Shock Coming
From 1915-1955 every spike in inflation was followed a short period of deflation. Most fundamentals are pointing towards such a deflationary period coming right now. Inventory of retailers is very high right now which will decrease demand in manufacturing and push prices down, oil prices are significantly down compared to earlier in the year and y/y readings will be deflationary in the coming months, new rent prices peak a few months ago, used car prices are coming down as well as most commodities. With this on top of the tight financial conditions the fed is creating I am expecting a very quick contraction in inflation.
CPI over the last 5 months has been 1% ( 2.4% annualized ) also considering the inflationary stimulus check sent out to allegedly flight inflation have been entering the economy the last few months, the majority in October, inflation numbers still came in under expectations. In November m/m inflation was only 0.1% with the tailwinds of stimulus money. The hot CPI sectors are starting to slow down as well.
CPI over the last 5 months has been 1% ( 2.4% annualized ) also considering the inflationary stimulus check sent out to allegedly flight inflation have been entering the economy the last few months, the majority in October, inflation numbers still came in under expectations. In November m/m inflation was only 0.1% with the tailwinds of stimulus money. The hot CPI sectors are starting to slow down as well.
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