FED FUNK

The Federal Reserve is finding itself in an increasingly unpleasant spot. Their preferred measure of inflation, Core PCE, rang in at 3.1% Y-o-Y in January, up from 3% in December, well above the Fed 2% target and pre-Iran conflict inflationary impacts. Subduing inflation calls for raising rates. However, the labor market is steadily softening which calls for lowering rates. As such, the Fed will keep rates unchanged this week.