Inflation Highest in Nearly 40 Years

At 6.81%, headline inflation is now the highest it has been since March 1982 (6.78%.)  Originally driven by sharply rising oil and gas prices…

…it is now broad-based and anything but transitory, with medical commodities the only category below the Fed’s original 2% target.

Algos responded with the usual VIX smackdown which, not surprisingly, began one minute before the BLS release.

It remains to be seen, once the market opens, whether carbon-based investors will be so enthusiastic about the prospects of a quicker Fed taper.

For history buffs and those with fond memories of price discovery, note that the Mar 1982 CPI of 6.8% saw the 10Y yielding 14.2%, a far cry from today’s 1.5%.  It’s a testament to just how broken the bond market is.

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