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The US dollar is carving out new highs following the S&P Global PMI. The comments in the report suggested broadening service sector inflation and that will get the Fed's attention.
At the same time, US stocks are struggling and the S&P 500 has fallen through the weekly low.
Bonds continue to vote for more rate hikes and there's now a 9.5% chance of a 75 bps hike at the May FOMC despite Powell ruling it out. Beyond that, there's now a nearly 30% chance of a 50 bps hike followed by 75 bps on June 15. The market has also priced in 1.75-2.00% Fed funds at the July meeting.
In short, this is a market that's more-fearful than ever about inflation.
You can see it in the dollar and in two-year yields.