Inflation's Last Stand
U.S. equity markets finished broadly higher this past week after a critical slate of inflation data provided further evidence of a definitive cool-down in inflationary pressures.
After narrowly snapping a three-week winning streak in the prior week, the S&P 500 advanced 0.8% this week, while the Mid-Cap 400 and Small-Cap 600 posted gains of over 1%.
Real estate equities were among the laggards for a second-straight week, pressured by a rebound in benchmark interest rates, which rose despite the encouraging inflation news.
The darker "underbelly" of the REIT sector dominated the news flow this week, which saw a controversial merger between two RMR-advised REITs, a turbulent direct listing of a previously non-traded REIT, and Blackstone unloading assets to meet redemptions.
The closely-watched CPI-ex-Shelter Index - the metric that showed the historic surge in inflation a year before it was reflected in the headline CPI and acknowledged by the Federal Reserve - has actually been in deflationary territory over the past three quarters.
U.S. equity markets finished broadly higher this past week after a critical slate of inflation data provided further evidence of a definitive cool-down in inflationary pressures, which again revived "soft-landing" hopes. The closely-watched CPI-ex-Shelter Index - the metric that showed the historic surge in inflation a year before it was reflected in the headline CPI and acknowledged by the Federal Reserve - has been in deflationary territory over the past three quarters, raising questions over whether the Fed is again caught offsides.
