The Return of Global Inflation

Investment Insights

The world economy is entering what could turn out to be a protracted period of weak growth and elevated inflation, according to the World Bank. The global inflation rates are continuing to erode consumers’ purchasing power and trust. The U.S. is also experiencing demand-driven inflation is seen in the labor market. Toward the end of 2022, markets will see a further slowdown in M&A activity due to the weak economy and an uncertain regulatory environment. 

Key Takeaways:

  • Prices have been increasing for a wide range of goods, including poultry, diapers, and petrol, over the past year, hinting at the return of global inflation.
  • The current inflation rate in the U.S. confirms that pricing pressures are pervasive and rampant across the economy.
  • American workers are lagging because of chronic, demand-driven inflation, which is significantly higher than nominal wage increases.
  • Many industries are feeling the strain and are under pressure to maintain historical performance as fewer dollars are available to spend on other commodities.

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