Welcome to Markets Desk, your midday read on what's moving markets and the broader economy.
The Fed's preferred inflation gauge came in right on target for April, with core PCE holding at an annual rate of three point three percent. That's not a surprise, but it's not a relief either — it confirms inflation is still sticky enough to keep the Fed sidelined, and any near-term rate cut narrative remains difficult to sustain.
Speaking of the Fed, incoming chair Kevin Warsh enters one of the most consequential roles in global finance at a complicated moment. Just last year he was pointing to artificial intelligence as a disinflationary force that could open the door to rate cuts. The reality on the ground is proving more complex, with AI-driven productivity gains taking longer to filter through pricing, while tariff pressures are pulling in the opposite direction entirely.
And on tariffs, a century of market data offers some historical grounding for investors rattled by the current trade environment. The pattern across one hundred years suggests that while tariff regimes introduce real volatility in the near term, markets have historically absorbed and repriced through the uncertainty — though the timeline and the pain along the way are never trivial.
That's the tape. Markets Desk, signing off the floor.
