DBI Today: 46.1 (−0.2)
The May inflation report landed at 8:30 this morning and it wasn't pretty. American consumer prices rose at 4.2% annually — the highest rate in over three years — driven almost entirely by the continuing disruption to energy flows through the Strait of Hormuz, the narrow waterway that carries roughly a fifth of the world's oil. Despite that headline, the index barely moved. That's partly because markets had already priced in a hot number; it's partly because Tuesday's equity session was mixed rather than catastrophic. But there is something uncomfortable in this calm. Inflation is running nearly twice the Federal Reserve's 2% target, oil sits above $93 a barrel, the Strait remains under a dual US-Iran blockade, and the fragile ceasefire is held together by little more than Trump's optimism about a deal "in two or three days" — a promise he has made over a dozen times without delivery.
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