U.S. headline CPI slid to 2.4 % in January—its lowest since March 2021 and beneath the 2.5 % consensus—while core inflation matched 2.5 % (ft.com). Markets instantly repriced: two-year Treasury yields fell to 3.42 %, and futures now assign a 50 % chance of a third Fed cut this year (ft.com). Yet price levels remain roughly 25 % above their 2019 base, leaving real wages still underwater for many households (apnews.com).

Investors cheering disinflation may be misreading the policy cross-currents. Trump-era tariffs are still feeding appliance and furniture costs, and sticky service prices tend to lag the cycle. The Fed risks easing into an election-year supply shock if shipping or energy disruptions revive headline numbers—remember how 2023’s brief oil spike rekindled inflation anxiety worldwide.

As Mohamed El-Erian warns, “the path from peak to target is rarely linear.” Expect volatile months ahead as politics, tariffs and geopolitics jostle the glide-path to 2 %. Vigilance—not victory laps—should guide both policymakers and portfolios.

— The Gist AI Editor

US Inflation Cools, Easing Rate Hike Fears

US inflation showed signs of cooling in January, with the annual rate slowing to 2.4%, down from 2.7% in December and below analysts’ forecasts of 2.5% (FT, WSJ). This moderation in the Consumer Price Index (CPI), which measures a broad basket of goods and services, was driven by a notable 1.5% drop in energy prices (Reuters). However, core CPI, which excludes volatile food and energy costs, rose 0.3% for the month, indicating some persistent underlying price pressures (Bloomberg). This mixed data gives the Federal Reserve room to maintain its current interest rate stance, balancing inflation control with economic growth.

Energy Markets Navigate Geopolitical Crosscurrents

Oil futures are facing downward pressure as the market digests conflicting geopolitical signals and demand outlooks (WSJ). While tensions in the Middle East typically support prices, the current sentiment is weighing the possibility of US action in Iran against a potentially weaker global demand forecast. In North America, major pipeline operators like Enbridge and TC Energy are ramping up investments in anticipation of growing energy needs, particularly from the burgeoning data center industry (WSJ). This highlights a long-term bet on rising energy consumption, even as short-term market dynamics remain uncertain.

Corporate Headwinds: AI Jitters and Executive Exits

The disruptive force of artificial intelligence is creating tangible market anxiety. Concentrix Corp., a major call center operator, faced a challenging $600 million bond sale as investors priced in the risk of AI automating its core business (Bloomberg). This signals a broader market recalibration for industries susceptible to automation. Separately, Sultan Ahmed bin Sulayem, the head of Dubai-based logistics giant DP World, has departed the company following the emergence of emails linking him to Jeffrey Epstein (FT). Such high-profile exits can introduce leadership uncertainty and reputational risk for major global corporations.

Germany Eyes Fiscal Flexibility for Strategic Resources

Germany is contemplating a significant policy shift, considering the exemption of a planned raw-materials fund from its constitutionally enshrined “debt brake” (Bloomberg). This move would grant Berlin greater financial latitude to secure strategic supplies and reduce dependence on single sources for critical industrial inputs. By sidestepping its strict borrowing limits, Germany aims to enhance its economic sovereignty and resilience in an increasingly fragmented global trade environment. The proposal underscores a growing trend of governments using industrial policy to address supply chain vulnerabilities.

Stay tuned for the next Gist—your edge in a shifting world.

Oil Moves Lower As Market Weighs Geopolitical Risk
— Wall Street Journal

US inflation falls more than expected to 2.4% in January
— Financial Times

ECB economists question Ireland and Luxembourg’s grip on asset managers
— Financial Times

DP World boss leaves company after Epstein emails
— Financial Times

Enbridge, TC Energy Investing in Projects to Tap Rising Energy Demand
— Wall Street Journal

Energy & Utilities Roundup: Market Talk
— Wall Street Journal

European Gas Prices Soften

Dutch Title Transfer Facility (TTF) natural gas futures, a key European benchmark, closed below €33 per megawatt-hour, providing some relief to the continent’s energy markets. March contracts saw a 1.5% decline, settling at €32.5/MWh (Ansa). This downward pressure is primarily attributed to meteorological forecasts indicating milder-than-normal temperatures across Europe in the coming weeks, which is expected to dampen heating demand. While this offers a welcome respite from the extreme price volatility of recent years, it underscores the market’s continued sensitivity to weather patterns rather than a fundamental resolution of long-term supply stability. The trend suggests a less severe winter energy crunch but leaves exposure to any late-season cold snaps.

Munich’s Political Risk Signal

At the Munich Security Conference, a significant geopolitical gathering, California Governor Gavin Newsom projected an alternative vision of American leadership, telling global leaders that “Donald Trump is temporary” (Politico). While not a direct market metric, this messaging from a potential U.S. presidential contender is closely watched by investors for signals on the future of transatlantic trade and regulatory alignment. For European markets, the intervention represents a hedge against the potential for renewed tariff wars and a retreat from international cooperation. It highlights a deep-seated concern among European policymakers and business leaders about policy predictability, a critical factor for long-term capital investment and supply chain stability.

Catch the next Gist for the continent’s moving pieces.

Sicherheitsgipfel der Deutschen Bahn
— ZDF

Azione di ‘guerriglia marketing’ a Napoli del cantante Santachiara
— Ansa

Maddaloni, un laboratorio-premio al liceo vincitore del Concorso Mad for Science
— Il Sole 24 Ore

Wie Angst vor einer Bargeld-Abschaffung geschürt wird
— ZDF

Cas lehnt Heraskewytschs Einspruch ab
— ZDF

Il gas si mantiene sotto i 33 euro in chiusura ad Amsterdam
— Ansa