The Federal Reserve's June Inflation Forecast Is In, and It's Not Nightmare Fuel for Wall Street for the First Time in Several Months

The article argues that the Federal Reserve’s June inflation forecast is the first encouraging sign in months for Wall Street, with the Cleveland Fed’s nowcasting model projecting TTM inflation to ease to 4.05% in June from 4.18% in May. That slight cooling, if confirmed, could reduce immediate fears of further inflation acceleration from the Iran war and energy shock. However, inflation remains elevated, with core PCE still expected to rise to 3.34%, leaving the door open for the Fed to abandon an easing bias and possibly raise rates later this year. The piece highlights the risk that higher borrowing costs could pressure a market already at record highs and heavily dependent on debt-financed AI infrastructure spending. Overall, the near-term tone for equities is cautiously mixed: June inflation may be less alarming, but the broader setup still threatens the bull market.