I'm still puzzled by all this talk of continuing high inflation, when the CPI-U has gone up at a very reasonable annualized rate of under 2.5% over the past nine months.

Looking at YoY numbers makes sense when the overall trend is flat and you want to take out the short-term noise. When there's a sea change (up or down), YoY numbers result in your understanding seriously lagging the changing reality.

I believe that's what happened to the Fed, when they were late to the party in starting their rate-raising campaign, causing them to have to ramp it up so fast to catch up to reality that they triggered the failure of SVB and Signature Bank and likely stressed many other banks.

Given the very muted MoM inflation numbers for the past nine months, I also believe their continued hawkish stance is no longer warranted and that they should pause, if not actually start reversing, their rate increases.