Happy Father’s Day to you fathers and father-figures! We hope you enjoy time with your loved ones.
This week the Federal Reserve left interest rates unchanged, a decision that was widely expected. The combination of good economic news and higher inflation paints a mixed picture. Last week’s measurement of 4.2% over May 2025 was the highest in 3 years1, but many underlying factors are moving in a more encouraging direction.
Energy prices have been an important contributor to inflation, and the recent ceasefire with Iran raises hopes that oil prices may stabilize if shipping through the Strait of Hormuz continues to normalize. Tariffs have also eased from last year's levels, reducing some pricing pressure on imported goods. Housing costs have moderated, and wage growth has remained below overall inflation. This points to a gradual ease in price increases.
While no one knows exactly whether the Fed will increase or decrease rates this year, the overall picture is more positive than it has been.
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There has been widespread speculation about where interest rates are headed next, and there are good arguments on both sides. If economic growth slows while inflation continues to ease, the Federal Reserve may have little reason to raise rates further. At the same time, if inflation proves more persistent than expected, policymakers could choose to remain patient before making any changes.
For you and us, Fed policy is less important than our own financial goals and situation. While the Fed makes news, and traders react to that activity, successful investors don’t rely on predicting Fed policy for their performance.
The current environment does not give us reason to change our investment or financial planning philosophy. We continue to believe that a disciplined, long-term approach remains the consistent way to navigate periods of both uncertainty and optimism.
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Other items:
- For Father’s Day, we’re sharing this beautiful story written by Sean Trende about Judson, his profoundly autistic son. We’ll let it speak for itself.
- What is the economic impact of the World Cup? This video provides a rundown of the clear but transient benefits of a 5 week event. Go USA!
- The story of how avocados became a year-round food option is surprisingly interesting. Over the past 30 years, average avocado consumption in the United States increased nearly ninefold!
1 Roush, T. (2026, June 10). Consumer Prices Rose 4.2% In May—Highest Inflation Since 2023. Forbes. https://www.forbes.com/sites/tylerroush/2026/06/10/inflation-hit-highest-rate-in-3-years-in-may/