GLED022 - PCE Reality Check — Inflation Persistence & Deployment Recalibration

PCE Reality Check: Core inflation 2.99% YoY, 99bp above Fed target. Treasury yields 4.18%, global risk-off. Deployment recalibration for higher-for-longer environment.

Show Notes

Welcome to Global Real Estate Daily, an AI-powered podcast by Daily Dominance. Friday, September 26th — PCE Reality Check. While others react to headlines, you get the recalibration playbook that turns inflation persistence into strategic advantage. What you'll get: - PCE data breakdown: Core inflation 2.99% YoY, still 99 basis points above Fed target—"higher for longer" just got more credible. - Treasury response: 10Y pushed to 4.18%, extending toward 4.2%. CRE financing floor firmed up in the 5.0%-6.3% range. - Global market response: PCE persistence created risk-off Friday across global markets. Asian markets down 1-2%, US equities -0.5%, dollar strengthening on higher-for-longer expectations. - Cross-border squeeze: Higher US rates and stronger dollar make foreign CRE investment more expensive—expect continued international pullback. Sector recalibration: - Inflation persistence favors assets with pricing power: industrial and multifamily with built-in rent escalations stay defensive. - Data centers remain secular winners if you control power and permits. - Office recovery signs real but rate-sensitive—prime-only strategy holds. - Retail resilient with steady consumer spending, but margin compression from higher costs coming. Your deployment reset: - Q4 refinancing windows narrower but viable—lock what you can before year-end. - European SNB divergence opportunities remain valid, but currency hedge costs increased. - New acquisitions: underwrite to 4.5%-5.0% long-term rates, not the 3.5%-4.0% you hoped for. - Cash-heavy operators have the advantage. Weekend positioning: - Recalibrate models and term sheets. - Sellers: accelerate timelines—buyer financing gets harder. - Buyers: stress-test everything at 200bp higher than today's rates. - International capital more selective—differentiate on fundamentals: location, tenant quality, expense control. Bottom line: PCE at 2.99% is a reality check. Fed's 2% target still 99 basis points away, and that gap costs money. Adjust assumptions, hedge currency, back assets with pricing power. That's how you stay ahead when inflation refuses to cooperate. Capital introductions ($50M–$250M): [e-mail]

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