Risk Assets have a Fed Problem

There is no sugar coating it, yesterday’s CPI number was a real problem. This was clear in the market reaction, which was fairly unprecedented in fixed income. 2y yields rose over 20bps, something hasn't happened in almost 15 years. What’s even more wild is that this is the third +10bp daily move in 2y yields in the past 3 weeks. The front end in yield is completely unanchored. Between the ECB last week leading to an 8 sigma move in front end European fixed income and CPI this week leading a similar type move in front end US yields, the front end doesn’t feel anywhere close to a level of equilibrium. The question now is, what sort of effect will this have on risk assets in general?