Fed's Brainard sees room for margins to compress and for businesses to bring down markups

• Expect to see some cooling of the economy over time
• We are getting mixed signals on the economy
• Our number one challenge is getting inflation down
• There's a fair amount of uncertainty
• We could see labor market demand coming down without much softening
• We're going to do what's necessary to bring inflation down
• The economy has a lot of momentum
• Business and household balance sheets are in a very healthy position
• I want to see a consistent series of declines in core inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term
• There's room for margins to compress and for businesses to bring down markups
• We're in a very unusual period so it's tough to predict when inflation will come down but I have confidence in our tools to get it done
• 50 bps market pricing seems like a reasonable path
• Getting out to September it's tougher to say, we'll have four more jobs and inflation prints by then
• If we don't see a deceleration in monthly inflation prints, then it might well be appropriate to have another 50 bps hike
• It's tough to see the case for a Sept pause now

Brainard slammed the door on the idea of a pause in September. That's given a bit of a lift to the dollar but a pause was a low probabiltiy anyway. Keep an eye on yields, US 2s are up 0.6 bps to 2.66% after touching 2.625% earlier.