MARCH 12, 2025 – The February report came in at 2.8%, below my estimate at 3.0%. The 3-month annualized inflation rate is 4.6%. The 6-month annualized inflation rate is 2.7%. These figures are at or above the annualized rate (2.8%) and thus indicate the annual CPI should remain steady. The data is predicting a reading of 2.4%-2.6% next month. Inflation is at its highest at the beginning of the year. So, I am thinking 2.6%-2.8%.
The market has the Fed Funds Rate priced at 4.1%-4.2%, down from 4.3%-4.4% the past few months. It was recently cut to 4.75%. The Fed doesn’t have much catching up to do. But, it seems, the market has given the Fed the go ahead to cut it 25bp next week.
Shalom,
The Mann
PS – I said I would not post stock market forecasts. However, with the current correction being the talk of the town, I might post something soon. Especially since the market forecasts the economy’s future and everyone has the ‘R’ word on their mind.