CPI in Focus as US-Iran Peace Talks Near | Bloomberg Surveillance

Higher energy prices from the Iran war were the central macro shock, and Tiffany Wilding of PIMCO argued they will lift headline inflation, squeeze real household purchasing power, and shave growth. She said PIMCO now expects headline inflation to accelerate to 4% in the next several months and has lowered its GDP forecast, while noting that higher tax refunds from the OB3 bill could cushion consumers. She also said the bond market should still offer value because a prolonged disruption could raise recession risk, even as a resolution and falling energy prices could ultimately push inflation below the Fed’s 2% target later this year or in early 2027.

Katie Kaminski of AlphaSimplex said trend signals had become more mixed after the war shock, but energy still showed strong, though less extreme, upward momentum and equities had started to recover. She described a weaker dollar trend that was interrupted by the conflict but could reassert itself if escalation continues to fade. She also said systematic managers have been de-risking as volatility rises, with her process focused on weeks-to-months rather than intraday noise.

Andrew Gilbert of Energy Capital Partners argued that the U.S. has a structural advantage because it does not need to burn oil for electricity, and that higher oil prices could increase LNG exports. He said data centers may ultimately lower electricity bills by spreading fixed wire costs over a larger customer base, while solar has become the cheapest new power source because gas turbines and nuclear remain far more expensive. Walter Todd of Greenwood Capital said portfolios should balance offense and defense, with lower credit exposure, attractive valuations in large-cap tech, and selective energy exposure after the recent rebound.