The fallout from COVID-19 may be reversing the long-term trend of low inflation, which has dominated the U.S. economy for decades.
Key Takeaways:
- The CPI surged almost 1% in June, the fastest rate in 13 years. Consumer prices have risen 5.4% over the last year.
- Two variables that have helped suppress inflation for decades might be reversing, which will create major problems for a financial system that runs on cheap money.
- As global markets face the risk of exorbitant public debt combined with rising interest rates, investors are starting to reconsider portfolio allocation strategies.