Ed Yardeni: Bond market wants Fed to be more vigilant on inflation

• The bond market is looking for the Fed to be more vigilant on inflation and to follow through on its commitment to price stability with action.
• The 2-year Treasury note currently suggests the Fed funds rate should be raised three times, indicating market expectations for further tightening.
• Yardeni draws a parallel to 2004, where bond yields rose despite Fed rate cuts, suggesting the bond market can disagree with and override the Fed's stated intentions.

Ed Yardeni discusses the bond market's reaction to the Federal Reserve's stance on inflation. He argues that the Fed's hawkish rhetoric on price stability has not been matched by concrete action, leading the bond market to push yields higher as it anticipates future rate hikes.