🚨 The Federal Reserve has already fallen into the most difficult predicament in history,

and there is no turning back.
The recently released US CPI data shows a situation far more severe than expected.
The inflation rate surged to 3.3%, reaching a new high since May 2024;
Core CPI rose simultaneously to 2.6%, the highest level since 2026.
As the first key inflation report of the year, it has clearly sent a signal:
Inflation is getting out of control.
The market has already significantly cooled expectations of rate cuts in 2026,
and this data almost completely closes the door on easing possibilities.
But the real trouble is not limited to this.
Another side of runaway inflation is the continued weakening of economic fundamentals:
Weak GDP growth, increasing employment pressures, stress in the private credit market, and persistent downturn in the real estate market.
This means the Federal Reserve is losing two core missions at the same time.
It aims for a 2% inflation target and around 4% stable employment,
but now, both indicators are diverging and deteriorating simultaneously.
Neglecting one for the other, trying to save one will cause the other to collapse.
Even more concerning is that energy shocks have not yet fully manifested.
The situation in the Strait of Hormuz remains tense, with ongoing risks accumulating, and the situation will only worsen.
Unlike 2020 and 2023, this time the Federal Reserve may be powerless.