Our (peak) Inflation Nowcast

Post this morning’s NOV CPI report and market reaction (with the latter being more important than the former), it’s easier to call for a Cycle Peak in INFLATION than it was when I hosted our #Quad1 Flash call last week.

Both the US stock and bond markets agree. Here are some of the main callouts and our updated GIP (Quad) Model Nowcasts: 

1. Our #Quad2 in Q4 nowcast is +6.52%
2. We’re expecting our 1^st sequential #slowing in December when Energy prices decel in the CPI
3. Our #Quad1 Goldilocks (or narrow #Quad4) in Q1 of 2022 nowcast is +6.15%

And, we now have a +93.8% probability of #Quad4 in Q2 of 2022 with INFLATION slowing towards +5.55%.

Reiterating our call that the UST 10yr Yield peaked alongside INFLATION during the #Quad2 periods of 2021. There’s a rising probability that the UST 2yr Yield peaks inside of +0.76% here in Q4 of 2021 as well.

Enjoy your weekend,

KM