Inflation is not going away as measured by the PCE core inflation rate. It is sticky which means that we will not be transitioning into a new inflation regime just yet. While we may not be in a regime of fire or ice but a simmering burn that does not lead to a risk-on environment. It is not clear that bonds are a safe asset because inflation expectations have not fallen. Inflation is still impacting real wages and savings are being eroded. Equities are supposed to be immune from inflation but at depends on whether firms have control of pricing.
The Man Institute in their work, "Varying by Degrees: Fire & Ice 2.0" describes the different regimes for inflation and shows what will be the average returns for several asset classes. This is all good work; however, we still need to know what is the regime and what are the points of transition. These transitions are often not easy to measure. A further Fed increase is likely, but the link between Fed policy and inflation does not seem too well-defined in the current environment.
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