Thank you!
Your support is sustaining the future of local news in our communities.

Sticky inflation slows market advance

February inflation data showed no progress on inflation. That follows the same kind of readings from the previous month. While two months does not make a trend, the disappointing numbers gave investors pause.

Both the Consumer Price Index (CPI) and its cousin, The Producer Price Index (PPI), came in warmer than economists had expected. Consumer prices rose 3.2% in February from a year earlier but were only slightly higher than economist expectations of 3.1%. The PPI rose 1.6% year-over-year, which was the largest gain since last September. Month-over-month, the

PPI at +0.6% was double the average forecast.

These data points should be taken with a grain of salt since a couple of higher numbers should be expected. Few, if any, macroeconomic trends travel in an uninterrupted straight line higher or lower. Unfortunately, these results practically guarantee that the Federal Reserve will hold off on any plans to cut interest rates.

No one was expecting the Fed to cut in March anyway. In Chairman Powell’s most recent statements, he indicated March was off the table. But now, the earliest the market can expect a cut will be in June, if then. Markets are now pricing in about a 59% chance of an interest rate cut in June. Given that economic growth and employment trends remain strong, some argue that the Fed need not reduce interest rates at all this year.

Any hint of no cuts ahead would not be taken kindly by the markets. That is because much of the gains in financial markets, whether in bonds, equities, precious metals, commodities, crypto, etc., have been fueled by investor expectations that the Fed is planning on reducing interest rates at least three times this year.

As such, the FOMC meeting notes will be released on the afternoon of March 20, and I suspect every word will be analyzed with a microscope. Chairman Powell’s Q&A session afterward will also be subject to the same scrutiny. I don’t expect that Powell will deliver a nasty downside surprise. After all, this is an election year, and while the Fed is supposed to be ‘non-political,’ I doubt they would want to upset the economic apple cart and influence one side or the other.

As readers are aware, I believe the stock market is in the ninth inning of this rally. Last week, the high on the S&P 500 Index was less than 44 points away from my top-of-the-range 5,220 target. I’ve noticed some changes in the market behavior while we made that new high.

The momentum that has been driving stocks since the beginning of the year is beginning to wane and, in some areas, even reverse. The action of late has been wild and there are some signs of short-term topping patterns.

The technology sector, for example, which has led the market all year, is beginning to struggle. Semiconductors have been choppy. Nvidia, the quintessential AI stock, is no longer going up 2-3% per day. It is now down about 100 points from its all-time high. Some stalwarts of the market like Apple, Google, and Tesla (to varying degrees) seem to be rolling over. Some say that where Apple goes, so goes the market.

In this risk-on environment, the declining dollar has been supporting commodities, especially gold and silver. However, the greenback, which is the world’s safest trade, has flattened out and may be starting to bounce as traders worry that lower inflation is not quite in the bag. All of this tells me to be cautious and while we could still climb higher, I would have one eye on the exit.

Bill Schmick is a founding partner of Onota Partners Inc. in the Berkshires. None of his commentary is or should be considered investment advice. Email him at bill@-schmicksretiredinvestor.com.

The views expressed here are not necessarily those of The Lakeville Journal and The Journal does not support or oppose candidates for public office.

Latest News

Motorcycle crash near Route 7 prompts Life Star landing at HVRHS

Motorcycle crash near Route 7 prompts Life Star landing at HVRHS

A Life Star helicopter lands on the front lawn of Housatonic Valley Regional High School on Saturday, May 16, to transport a motorcycle crash victim to a hospital.

Aly Morrissey

LIME ROCK — A motorcycle crash involving a car temporarily shut down a section of Route 112 near the intersection with Route 7 on Saturday afternoon, drawing a large emergency response and prompting a Life Star helicopter landing at Housatonic Valley Regional High School.

Emergency responders at the scene confirmed the incident involved a motorcycle and passenger vehicle. Route 7 was closed from Dugway Road to the intersection of Routes 7 and 112 while crews responded.

Keep ReadingShow less
Van strikes utility pole, closes Route 112 for hours

Traffic was diverted near Wells Hill Road after a crash closed part of Route 112 Friday afternoon.

By James H. Clark

A van crashed into a utility pole on Route 112 near Wells Hill Road Friday afternoon, leaving the driver hospitalized in serious condition and forcing the highway to close for several hours.

The crash was reported at approximately 3:20 p.m., according to Connecticut State Police Troop B.

Keep ReadingShow less
Voices from our Salisbury community about the housing we need for a healthy, economically vibrant future

Renee Wilcox

If you’ve ever wandered through Paley’s Farm Market, you probably know Renee Wilcox. For thirty years, she has been greeting you with unmistakable warmth—always ready with a smile. Renee grew up in Millerton, but it was in Salisbury that her family found something they’d never had before: a true sense of home. In 2003, she and her husband Bill were living in Millerton, but Bill—a volunteer with the Lakeville Hose Company—was already part of Salisbury life. When the Salisbury Housing Trust finished eight new homes on East Main Street (Dunham Drive), Renee and Bill were the first to sign on.

The story of those houses is really a story about the best parts of our community. Richard Dunham and his wife, Inge, along with the Housing Trust board, poured years of energy and hope into the project. Renee can’t help but light up when she talks about the people who helped her family settle in. Digby Brown came by to install appliances and bathroom cabinets; Barbara Niles spent hours painting; Carl Williams assembled bunk beds for the kids. Rick Cantele, at Salisbury Bank, helped them with their finances so they could qualify for a mortgage, while neighbors arrived at their door with fruit baskets and welcoming words.

Keep ReadingShow less
google preferred source

Want more of our stories on Google? Click here to make us a Preferred Source.

Trade Secrets: a glamorous garden event with a deeper mission

Heavy stone garden ornaments, a specialty of Judy Milne Antiques from Kingston, at Trade Secrets 2025.

Christine Bates

Tucked away on Porter Street in downtown Lakeville, Project SAGE is an unassuming building from a street view. But cross the threshold a week before Trade Secrets — one of the region’s biggest gardening events, long associated with Martha Stewart and glamorous plants of all varieties — and you’ll find a bustling world of employees and volunteers getting ready for the organization’s most important event of the year.

“It’s not usually like this,’ laughed Project SAGE director Kristen van Ginhoven. “But with Trade Secrets just around the corner, it’s definitely like this.”

Keep ReadingShow less
Two artists, two Hartford stages, one shared life

Caroline Kinsolving and Gary Capozzielo at home in Salisbury with their dogs, Petruchio and Beatrice

Provided
"He played his violin, I worked on my lines, we walked the dog, and suddenly we were circling each other perfectly."
Caroline Kinsolving

Actor Caroline Kinsolving and violinist Gary Capozziello enjoy their quiet life with their two dogs in Salisbury, yet are often pulled apart to perform on distant stages in far-flung cities. Currently, the planets have aligned, and both are working in Hartford, across Bushnell Park from one another. Bridgewater native Kinsolving is starring in “Circus Fire,” the current production of TheaterWorks Hartford, while Capozziello is a violinist and assistant concertmaster of the Hartford Symphony Orchestra. While Kinsolving hates being away from home, she feels the distance nourishes their relationship.

“We are guardians of each other’s confidence and self-esteem,” she said.

Keep ReadingShow less
Local filmmaker turns spotlight back on Hollywood’s Mermaid

Esther Williams in “Million Dollar Mermaid” (1952).

Provided

For decades, Esther Williams was one of Hollywood’s brightest stars, but the swimming sensation of the silver screen has largely faded from public memory — a disappearance that intrigued Millerton filmmaker Brian Gersten and inspired him to revisit her legacy.

As a millennial, Gersten grew up largely unaware of Williams’ influential career. His teen years in Chicago were spent with friends who obsessed over movies, spending hours at their local independent video store,and watching anything that caught their eye. Somehow, though, they never ventured into the glossy world of synchronized-swimming musicals of the 1940s and ‘50s.

Keep ReadingShow less
google preferred source

Want more of our stories on Google? Click here to make us a Preferred Source.

google preferred source

Want more of our stories on Google? Click here to make us a Preferred Source.