Inflation continued its rapid surge in June, rising at its fastest pace in nearly 13 years amid an ongoing burst in used vehicle costs and increases in both food and energy.
The consumer price index increased 5.4% from a year ago, the largest jump since just before the financial crisis. Economists surveyed by Dow Jones had been expecting a 5% gain…
Inflation is coming from Asia and from a mix of Supply chain and Supply constraints, not from the demand. In addition, if the demand accelerates, inflation will become out of control. The Delta variant will postpone the end of the transition period and delay the massive recovery of the demand. Anyway, the lack of supplies and the demand for the same assets all around the world (ex: EVs!!!).
The Central banks and markets (analysts expect +61% of S&P500 earnings growth) are stuck between the hammer and the rock… Our GTO (Global Tactical Opportunities), a global macro hedge fund strategy daily liquid, is already prepared for when markets will realize they are jammed.
Either Inflation or a new drop in consumption will dent the earnings growth. In addition, the base effect won’t so friendly as during the S1…
