The US #stock market continues its decline as Wall Street tries to price the equity markets on how aggressively the US Federal Reserve will increase rates and rein in surging prices. U.S. inflation accelerated last month in the fastest rise since 1982, at 7.5% or almost 3X over target mostly over labor and supply chain shortages.
#Investors found temporary relief in the strong earnings reported over recent weeks but as this earnings season winds down, the Street will turn its attention back to the inflationary concerns. The Bank of Canada, European Central #Bank and Bank of England are all tightening monetary policy along with the Fed. Not knowing exactly how much will continue to cause volatility in the stock markets.
#Crypto assets like #BTC and #ETH may be a good inflation hedge in such cases. Nevertheless, the fundamental drivers of inflation are starting to improve with the economy making big progress to reduce supply-side shortages. Thus, the recent surge in inflation may decline in coming months with higher bond yields, a stronger US dollar, and rising inventories. Some experts predict that inflation will level off below current levels but remain slightly above the historical average. In that scenario, value stocks could shine.This article sheds more light on what the coming months look like. What do you think?