Market Musings 9/11/2025
Quick thoughts on the markets and major portfolio news. Not on Ursa yet? Download Ursa from the App Store!
#Inflation tolerable, but jobless spike raises risks
#Inflation came in high, but tolerable… That’s good news for markets, but with #LaborMarkets jobless claims spiking is the #Tariffs soft landing really safe?
Core CPI rose 0.3% M/M. Much hotter #Inflation than the Fed’s 2% annual target, but still seen as ok given #Tariffs. Meanwhile, the overall CPI was a bit hotter at 0.4%. It was mostly driven by food which is less likely about #Tariffs and more about labor disruptions from immigration policy.
But the real shocker? Weekly jobless claims jumped to 263K－a 4-year high. While just one week of data, that’s a big flashing red light for #LaborMarkets stress.
What does this mean for #RateCuts? Well, that 25bps cut next week looks locked in, but investor focus is already shifting to what’s next.
Markets are pricing in three #RateCuts by year-end and six total through 2026. Powell sounded dovish at Jackson Hole, but we’ll see how much the Fed has actually shifted. The last dot plot back in June had only penciled in 4 #RateCuts through next year.
While #LaborMarkets seem very fragile, if #RateCuts are too quick, it could risk reigniting #Inflation that’s sticky with #Tariffs headwinds still to come.
The stage is set for next week’s Fed meeting. The big question: should the Fed move quickly to stabilize #LaborMarkets or stay more cautious with #Inflation starting to rise again?
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Original Photo by Pixabay.