# Why the Fed Is Watching the 2-Year Breakeven Rate

Page: https://stenobird.com/podcast/the-federal-reserve-podcast-with-fexingo-interest-rates-fomc-meetings-and-monetary-policy-7871696/why-the-fed-is-watching-the-2-year-breakeven-rate
Text version: https://stenobird.com/podcast/the-federal-reserve-podcast-with-fexingo-interest-rates-fomc-meetings-and-monetary-policy-7871696/why-the-fed-is-watching-the-2-year-breakeven-rate.md
Podcast: [The Federal Reserve Podcast with Fexingo: Interest Rates, FOMC Meetings, and Monetary Policy](https://stenobird.com/podcast/the-federal-reserve-podcast-with-fexingo-interest-rates-fomc-meetings-and-monetary-policy-7871696)
Published: 2026-07-12T05:41:35+00:00
Episode link: https://audio.fexingo.com/business/the-federal-reserve-podcast/episode-0109.mp3
Audio file: https://audio.fexingo.com/business/the-federal-reserve-podcast/episode-0109.mp3
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JSON: https://stenobird.com/v1/public/podcasts/the-federal-reserve-podcast-with-fexingo-interest-rates-fomc-meetings-and-monetary-policy-7871696/episodes/why-the-fed-is-watching-the-2-year-breakeven-rate
Duration seconds: 443

## Resource

Episode 109 of The Federal Reserve Podcast with Fexingo: Interest Rates, FOMC Meetings, and Monetary Policy. Lucas and Luna dive into the 2-year breakeven inflation rate, a market-based measure that strips out noise from volatile energy prices. With core CPI stuck around 3.3% year-over-year and the 2-year breakevens hovering near 2.6%, the Fed faces a tricky signal: bond markets expect inflation to stay above the 2% target even as headline CPI cools. The hosts discuss how this metric affects the FOMC's rate path, especially after the weak June payrolls report. They also touch on the recent 'funflation' trend—where staying home has become more expensive—and what it means for inflation expectations. Plus, the hosts explain how the 2-year breakeven offers a cleaner read than the popular 10-year breakeven, which is muddied by term premium. If you want to understand one of the Fed's most under-the-radar inflation gauges, this episode delivers. #FederalReserve #InterestRates #FOMC #MonetaryPolicy #Inflation #BreakevenInflation #2YearBreakeven #CoreCPI #PCE #LaborForceParticipation #Funflation #EconomicData #BondMarket #InflationExpectations #Economics #FexingoBusiness #BusinessPodcast #CentralBanking Keep every episode free: buymeacoffee.com/fexingo

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