Treasury yields sat near multiyear highs Wednesday. They did this because August's CPI report showed sticky inflation. Sticky is what economists call it when the number doesn't go down the way they promised it would six months ago.
Investors weighed the impact of this report. Weighed it against what, nobody specified. Their feelings probably. Maybe a TikTok they saw about rate cuts. The weighing process involves staring at a screen and then doing exactly what the algorithm was going to make them do anyway.
The ten-year yield doesn't care that you read the headline. It doesn't care that you have opinions about the Fed. It's been grinding higher for weeks while retail traders convinced themselves that one more data point would change everything. One more report and Powell would definitely pivot. One more month and their calls would print.
They didn't print.
August CPI came in sticky. Not hot. Not cool. Sticky. This means it exists in that special range where CNBC can book six different guests who will say six different things and all sound correct for ninety seconds. The number was exactly ambiguous enough to keep everyone employed.
Treasury yields remained near multiyear highs because that's where they were yesterday. Technical analysts call this continuation. The pattern emerged months ago. Higher lows. Higher highs. A trend so obvious that talking about it feels like describing how stairs work. But the financial news cycle demands fresh panic every morning, so here we are. Weighing impacts. Digesting data. Assessing implications.
The bond market already moved. It moved weeks ago. The CPI report just gave everyone permission to write about something that already happened and pretend it's breaking news. Meanwhile your portfolio is doing whatever it was going to do regardless of whether you refreshed Bloomberg seven times before lunch.
Sticky inflation means you're still poor, just with better headlines about it.
Photo by Joachim Schnürle on Unsplash
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