The PCE inflation report released on the last day of the month capped off the view that the Fed is successfully on a path to a soft landing. This narrative broadly boosted equity and bond markets over the course of the month. We remain cautious in concluding that the lagged effects of monetary policy are going to precisely complete the Fed’s job with limited impact on the economy. Meanwhile, the Fed is shrinking their balance sheet, and the cost of borrowing remains markedly higher than average interest rates in maturing debt.