• ‚Cautiously optimistic‘ inflation will fall without job market damage
• Fed policy actions have helped bring inflation pressures down, helped anchor inflation expectations
• economy appears to have dodged a wage-price spiral
• Inflation pressures have cooled significantly
• Fed has faced less of a trade off between inflation and jobs
• Workers and employers are better at finding each other now
• Goods and labor shortages have declined

There’s not a hawkish word here despite the higher inflation data in January. I was worried this morning after Barkin that we could see something of a coordinated push from Fed officials to warn that rates could stay higher for longer. Instead we get this and yields have crumbled.

This article was written by Adam Button at www.forexlive.com.