The Federal Reserve lifts rates to its 5% range. Offers no real guidance, market is beginning to show signs that all is not right. 3 Points that offer clues that stagflation has unintentionally been set alight by the Fed.

The Federal Reserve is probably losing control of the markets, this could be attributed to 3 points.  

1.  They're ambiguity with their on again and off again dovish to hawkish rhetoric, which is beginning to show up as a lost of credibility; hence the market swinging back and forth with expectations of a recession and stagflation in 2022, when they began their rate hikes, which interestingly enough, stagflation has been priced out of the market due to the falling oil price.  Yet, it is in clear view that a stagnated economy with imbedded inflation is more likely than a deflation based recession.  Called by Wall Street and commercial banks in 2022, the U.S. recession did not materialize, instead employment within the the service sector is at 18 year highs, which is a classic primer for wage/price inflation. 

2.  They, the Fed, are playing both sides of the coin.  With money printing and the revigorated expansion of their balance sheet, by setting up open market operations to capitalize all banks after the Silicon Valley Bank collapse, thus trying to keep credit markets buoyant, while they are actually tightening liquidity at the same time.  Doesn't make sense.  Rates are now at 5%, that may become their terminal rate, but as noted in my February 2023 1st post, the rate could be over five and between 10 percent, meaning the Fed may continue on a interest rate path well into 2024.   If they do indeed pause, as noted in this post.  Oil, which is bid again on Fed chairman Jerome Powell dovish/hawkish mix, could become sticky above $70 a barrel; and if the U.S. Dollar is allowed to depreciate, ala The Fed $ swap lines with other Central Banks go into hyper drive + geopolitical mayhem. Oil could return to its 2022 high at $100 a barrel. 

3.  The collapse in the 2YR and 10YR yield/s is pointing towards bond market turmoil, as the market is pricing in the potentiality of a stock market crash.  With the sudden collapse of the 2YR yield being eerily similarly to the prelude of October 1987 market wipeout and the 2008 credit crisis. 

Chart above shows Gold, USD and oil futures (below pane/s) and the 2YR and 10YR yields.  Gold is bid with USD and the said yields depressed.  Oil is holding onto its $70 support.