The end of the hiking cycle

There were no surprises yesterday from the #fomc meeting. Rates were kept constant at 5.25-5.5% despite the recent spike on #cpi. Probably the Fed wants to give the economy and consumers some time to digest the #ratehikes to date, as they have been fast and furious. Powell mentioned once again, however, that rates will be higher for longer, signaling there will be no rate cuts on the foreseeable future. However, as you can see in the chart below, both cyclical and non-cyclical factors contributing to core PCE, the inflation rate for the economy, have started to turn down. Also, Inflation breakevens that come out of #tips indicate the inflation expectations are subdued, despite the recent spike on oil prices. The rational behind it may be that oil demand will slow down as prices go up, which will force oil prices to correct. And across the pond, the #ecb hiked rates last week but indicated that it might be done for this cycle.