CPI data has landed. Although it matched expectations, inflation has returned to a high of 4.2%, which still leaves one gasping.

The market had previously been wildly confident about the “Trump effect,” with even some statistics claiming that he himself announced 28 victories. However, the reality is that the Strait of Hormuz remains tightly locked. Oil prices not only failed to be brought down, but are even higher than they were during the Biden period—this is a pretty loud slap in the face.

The upcoming monetary policy meeting is destined to be tough. Stop fantasizing about rate cuts in 2026—if we can just avoid further rate hikes, that will be a victory. Even if the Strait of Hormuz is reopened tomorrow, the lag in how inflation transmits means high interest rates will have to be endured for several more months. Tough times—are just starting. #非农数据超预期加息预期升温