August 10th CPI Report — Our First Positive Surprise in a Long Time!

Market Rebellion

This article was last updated on 08/10/2022.

PPI, PPI Data, November PPI, December PPI, producer price index, market reaction to ppi

August 10th CPI Report

Wow, a positive surprise? The August 10th CPI Report sees a better than expected inflation read! What kind of world are we living in here? This is something that hasn’t happened in a long, long time!

  • US July Consumer Prices Index (Headline Number): UNCHANGED vs +0.2% Expected (Better than expected!)
  • US July CPI Ex-Food & Energy: 0.3% vs +0.5% Expected (Better than expected!)

As a result: a bull steepening is taking place! That’s when the short-rate falls at a faster rate than the longer-term rate, which is a correction of the yield curve inversion. As a result, the Fed Futures is starting to price in a smaller rate hike in September.

And let’s talk about the most important thing: Stocks are ripping.

The S&P 500 rocketed higher 1.64% immediately on the news, the Nasdaq soared more than 2%, and the IWM is trading higher by more than a percent-and-a-half as well!

We’ll have to wait until open to see how this plays out, but as it stands, it looks like bulls are about to wake up very, very happy.

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