Tag Archives: The Fed

Mann Overboard

INFLATION & FED FUNDS RATE UPDATE

UPDATE SEPTEMBER 11, 2025 – RIP Charlie Kirk and Never Forget 9/11. This country and world need a lot of help is all I will say.

August CPI came in on target at 2.9%. The data points to 3.0% next month followed by a surge above 3% through yearend. Again, whether there were tariffs or not, this was going to happen. Tariffs are not relevant.

As of today, the market has set the Fed Funds Rate at 3.7%-3.9%.

SEPTEMBER 8, 2025 – The consensus, and my data, expect CPI to increase to 2.9% from last month’s 2.7%, Just a reminder, this has nothing to do with tariffs. But, those who think it does will be screaming they are right.
The market is giving a 100% chance that the Fed will reduce its rate at the September meeting by 25bp. A 12% chance it will be 50bp. Currently, the market has the Fed Funds Rate priced at 3.9%-4.0%. It is set at 4.25%-4.5%. As I have said all along, the market would put rates at a point that tells the Fed to lower them by 25bp, with a minor chance of 50bp. I believe we are around a bottom for interest rates. So, I think it will be unlikely we see a 50bp reduction. Let me conclude with what I wrote on August 8th:
“Let me say this in advance – technical indicators are suggesting higher rates after September. Also, if CPI does go to 3.0%-3.5% in the 4th Quarter, a rate increase before yearend is more likely than a second or third rate decrease. That would surely infuriate a lot of people. You heard it here first. I will address this more as we enter the Fall.”
Shalom,
The Mann

Mann Overboard

INFLATION & FED FUNDS UPDATE

UPDATE JULY 29, 2025 – It’s the day before the Fed announcement. As noted below, interest rates have not changed in the past 2 weeks. The market still has the Fed Funds Rate priced at 4.3%-4.4%. Right in the middle of the current 4.25%-4.5% range. The rate should remain unchanged and Trump should still be mad at Powell. The market is pricing in a reduction in September. I will see where we stand in two months.

JULY 15, 2025 – The June report came in at 2.7%, a tick above the range that the data predicted. The 3-month annualized inflation rate is 3.5%. The 6-month annualized inflation rate is 4.4%. These figures are above the annualized rate (2.7%) and thus indicate the annual CPI should increase over the next few months. The data is predicting a reading of 2.8%-2.9% next month. I think that will be spot on. Please note, the CPI increases this Summer will be because inflation was around 0.1% per month last Summer. The increases will not be due to tariffs.
On July 30th at 2pm Eastern, the Fed will announce its decision on the Fed Funds Rate. The market has the Fed Funds Rate priced at 4.3%-4.4%. It is currently 4.25%-4.5%. The market is telling Mr. Powell not to cut the rate. Things can change in two weeks. But, that is doubtful as rates have been steady for awhile. A sure bet is President Trump will tweet soon thereafter condemning Powell again:)
Shalom,
The Mann

Mann Overboard

INFLATION UPDATE

JUNE 12, 2025 – The May report came in at 2.4%, at the lower end of the range that the data predicted. The most ridiculous forecast was from Goldman Sachs that expected a 2.9% reading. They could pay me half of what they pay their CPI staff and save lots of money and be more accurate with their forecasts. LOL
The 3-month annualized inflation rate is 3.0%. The 6-month annualized inflation rate is 3.8%. These figures are above the annualized rate (2.4%) and thus indicate the annual CPI should increase slightly. The data is predicting a reading of 2.6% next month. I think that will be in the ballpark. There is a chance it could go as high as 2.8%. The one thing today’s reading showed us is tariffs do not cause inflation.
The market has the Fed Funds Rate priced at 4.3-4.4%. It was recently cut to 4.25%-4.5%. The Fed doesn’t have any catching up to do. There will not be a reduction in this rate at next week’s Fed meeting. Also, President Trump will tweet soon thereafter condemning Powell again:)
Shalom,
The Mann

Mann Overboard

THE MARKET AND THE FED FUNDS RATE

AUGUST 31, 2023 – As we end August, a quick look at what the market is telling the Fed to do at its September 19-20th meeting. 3-month and 6-month Treasury Bills are yielding 5.56%-5.58%. The Fed Funds Rate is at 5.25%-5.5%. That is saying not to raise the rate. However, it wouldn’t take much for those rates to get to a point where the market says to raise rates by another 25bp.
For awhile the market has said no change in September and a 25bp increase in December. That seems to still be the case. We will see if anything changes over the next few weeks.
Have a great Labor Day weekend.
And good riddance to July and August!
Shalom,
The Mann

Mann Overboard

INFLATION AND THE ONGOING RECESSION

OCTOBER 16, 2022 – First, a moment of silence for Marie Antoinette who was beheaded on this day in history. Would it be appropriate, or not, to honor her by having a piece of cake….but, I already digress:)
I have never tried to forecast inflation. I have probably made a forecast on most everything. Just not the CPI.
But, as it is just numbers. And I LOVE numbers. I figure what the heck.
After doing my analysis by hand (as always…I am not into spreadsheets and so on….the old-fashion way works best for me), my forecast is for annual CPI to end 2022 below 8%. For a range, I say 7.6% to 7.8%.
I am looking at below 7% (say 6.7%) at the end of the first quarter in 2023. And below 6% (say 5.9%) at the end of the second quarter in 2023. After doing my research, I have to say it is insane to try to forecast inflation more than a quarter out.
I guaranty that I have not looked at anyone else’s forecasts. I don’t know if anyone forecasts inflation rates 3-9 months out. So, pure coincidence if you have seen anything that is around my numbers above.
Also, those numbers will do nothing to keep the Fed from raising rates by 75bp two more times. Please remember, as I have posted here forever, the MARKET will tell you how much rates are going up. The Fed has FOLLOWED the market 100% of the time. The Fed never makes the decision. The market tells the Fed what to do and when.
Hold on….did you feel that….I bet you did….my outdoor thermometer just went from 72.6 degrees to 72.4 degrees. Wow, the climate changed!
Ooops, I did it again (hats off to you Britney)…I digressed again.
My last note is regarding our ONGOING recession. ((Someone please tell Jamie Dimon, who said we might enter a recession next year, that we have been in a recession ALL YEAR!)) With the stock market hitting new lows recently, the current economic downturn is now forecast to extend thru the 1st Quarter of 2023. Additional lows in the stock market will continue to push that date out.
Oh, one other last note. The US Dollar either has, or will within the next few weeks to a month, put in a MAJOR top. I don’t know how a weaker dollar plays into your world. But, something for you to consider.
And that gets me all caught up on all my forecasts. The inflation one won’t be near as easy as the housing one was in June. Some forecasts are easy. Some are difficult.
We shall see how the above turns out.
Shalom,
The Mann