Weekly Strategy Perspectives - Great (Inflation) Expectations – Part I

Weekly Strategy Perspectives - Great (Inflation) Expectations – Part I

"Inflation is as violent as a mugger, as frightening as an armed robber and as deadly as a hit man.”

― Ronald Reagan

The Through Line: Last week’s toasty reads on U.S. consumer and business inflation nudged both bond yields and investor anxiety higher. Many market watchers were surprised it hadn’t happened sooner, given the ongoing energy shock of the past few months on top of persistent cost stickiness created by last year’s shifts in tariffs, trade, and immigration policy. Inflation and interest rates (bond yields) are closely related. However, there are important nuances in what influences each – and how they interact with each other. This week, we do a deep dive into inflation. Next week, we will delve more thoroughly into fixed income markets and how they are absorbing increased supply and shifting fundamentals.

Click to read: Weekly Strategy Perspectives - Great (Inflation) Expectations – Part I