Markets

Inflation comes skulking back

Dynamicfoto / Shutterstock
Dynamicfoto / Shutterstock

Like the proverbial frog that does not notice the rise in water temperature until it's too late, investors seem to be experiencing a similarly stealthy rise in inflation. Changes in headline inflation measures suggest a gentle firming in prices. However, underneath the surface there is evidence that inflation may continue to rise past the steady 2% nirvana that central banks prefer. Consider the following:

Housing costs are now rising at the fastest pace in nearly a decade.

core inflation CPI Owners' Equivalents Rent (OER)
chart-rent-v2

Medical inflation is not as contained as many had hoped.

Wages are rising.

Consumer inflation expectations are also starting to tick higher.

oil TIPS gold Russ Koesterich , CFA, is Portfolio Manager for BlackRock's Global Allocation team and is a regular contributor to The Blog .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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