Key Takeaway: The rise in shelter costs in September was the largest contributor to headline inflation but will not likely show up in upcoming months as rent prices moderate. Annual core inflation decelerated to 4.1% in September from 4.3% the previous month.

Highlights From the September Consumer Price Index (CPI) Report:

• Annual headline inflation was 3.7%, unchanged from August as firms are still able to pass along higher wholesale prices.

• Core inflation decelerated to 4.1% in September, slightly below the previous month’s rate of 4.3%.

• Shelter was the largest contributor to the m

Rating agencies have been busy lately. While one of the big three (Fitch) made headlines recently when it downgraded U.S. government debt, the other two (Moody’s and S&P) have been busy quietly downgrading U.S. corporate debt at an elevated pace. With the increase in Treasury yields over the past few years, corporate interest payments are set to increase as well. And while the health of the corporate landscape is generally positive, rating agencies are starting to adjust their outlooks based upon, among other things, the expected increase in debt payments.

The ratings environment remains relatively calm for companies ac

U.S. Treasury yields have seemingly been moving in one direction lately (higher), with the 30-year Treasury yield temporarily breaching 5% for the first time since 2007. The move higher in yields (lower in price) has been unrelenting, with intermediate and longer-term Treasury yields bearing the brunt of the move. There are several reasons we’re seeing higher yields, but rates are moving higher alongside a U.S. economy that has continued to outperform expectations, pushing recession expectations out further, and by the unwinding of rate cut expectations to be more in line with the Federal Reserve’s (Fed) “higher for longer&r

As the tides of inflation appear to be shifting, we thought it would be interesting to look at the historical correlations between stock and bond yields during periods of these changes, and what it could mean for stock prices going forward.

Appropriate with any inflation story, we must start in the 1970s. Throughout the entire decade, with a brief lull between 1971 – 1973, we saw runaway inflation. Core CPI reached its pinnacle in February 1978, coming in at 11.7%. As inflation was raging, the relationship between equity prices and bond yields was inverted. Higher yields used to fight off inflation stymied stock returns. Be