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From Torsten Slok at Apollo World Administration. The image says all of it, nonetheless Torsten’s commentary is very good:
Inflation is perhaps coming down over the approaching quarters. That is what the Fed is predicting, that’s what the consensus is anticipating, and that’s what we’re predicting. The issue is that this has been the forecast ever since inflation began going up in April 2021, see chart beneath. Given how systematically mistaken inflation forecasts have been over the sooner 18 months, there are good causes to be cautious relating to the present forecast.
It is typically how market expectations have superior. Is inflation inherently unpredictable? Are we collectively in thrall of the same mistaken mannequin? Does “expectation” point out the same take into consideration fashions and surveys? Are market hazard premiums actually essential?
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