Syz the moment

-> Headline CPI: o Consumer prices rose 0.3% MoM (more than the 0.2% expected), driving the YOY change to 3.1% YoY versus 2.9% expected. Still, the decline from the +3.4% shows the disinflation trend is in place o Under the hood, food and Energy services costs jumped MoM along with transportation services -> Core CPI: o The index for all items less food and energy rose 0.4% MoM in January, the biggest jump since April 2023. The shelter index increased 0.6% MoM in January and was the largest factor in the monthly increase in the index for all items less food and energy. o Core CPI fell below 4.00% YoY for the first time since May 2021, but the +3.86% YoY print was hotter than the 3.7% expected. -> SuperCore CPI: o Core CPI Services Ex-Shelter index soared 0.7% MoM (the biggest jump since September 2022), driving the YoY change up to +4.4% - the hottest since May 2023 (see chart below). Our take: The disinflation trend remains in place. However, the “easy part” of the disinflationary process is behind. Buoyant final demand might sustain some upward pressures on prices. This data raises the odds that the Fed will stay put in March. Source: Bloomberg, www.zerohedge.com

Bottom-line: go LONG Fiscal deficits receivers and go SHORT Fiscal deficit payers (i.e interest-rate sensitive sectors) "The wider-than-normal divergence between loose fiscal policy (which is stimulating) and tight monetary policy (which slows things down) contributes to wider-than-normal divergence between the performance of different economic sectors. It results in a wider-than-normal gap between sectors that are directly or indirectly on the receiving side of the deficits (eg business that rely on spending from upper and upper-middle class spenders) vs those that are the most sensitive to interest rates and thus are the most hurt by tight monetary policy (eg commercial real estate). And because some sectors of the economy are doing great partially due to the fiscal stimulus, it makes it unlikely that monetary policy or other assistance will arrive to the weaker areas any time soon. And ironically, because public debt levels are high, tight monetary policy *contributes* to looser fiscal policy by increasing the overall interest expense of the government, which goes to various entities in the economy and strengthens some of the sectors that are not sensitive to interest rates. This is a condition known as fiscal dominance". Lyn Alden

Source: Visual Capitalist

Temu is going all in on Marketing (including in this Sunday’s Super Bowl) Marketing spend: • 2023 - $1.7 billion • 2024 - $3 billion (est.) source : wsj

US Medium-Term Inflation Expectations Lowest in 11 Years of Data – Source: Bloomberg

That would shrink a $575bn trade pipeline to practically nothing, Bloomberg analysis shows. For China ’s economy and its slumping stockmarket — down >40% from its 2021 high — that’s bad news. Worse, Trump’s rhetoric may add pressure on Biden to take harsher measures in the run-up to election day Source: HolgerZ, Bloomberg

And experts say it could cost Americans their homes, spending power and national security - Fortune Source: Markets & Mayhem

16.1 million U.S. employees will be completely absent from work today following Super Bowl Sunday, according to this year’s research from UKG. In 2023, nearly 18.8 million employees said they planned on missing work on Super Bowl Monday. However, 6.4 million further employees plan to come to work late, another 11.2 million are unsure of whether they will come to work, and around 6.4 million will decide what to do on the day. The number jumps up for U.S. employees who plan to miss at least some work on Monday, reaching around 22.5 million employees – 14% of the U.S. workforce. The research also finds six million employees have not yet notified their employers and will call in sick on the day or simply ‘ghost’ their employer on Monday. source : The Harris Pol, UKG Workforce Institute