11 May 2022

Inflation, rising rates, and market volatility: Navigating the perfect storm with real assets

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by Seema Shah, Managing Director, Chief Strategist

Inflation is the single biggest challenge that investors face today. The sudden and sustained jump in prices has inflicted a considerable shock to the economic system, sharply pushing up interest rates, while challenging corporations and equity markets. For individuals, inflation quietly erodes the purchasing power of savings and cash, a significant problem, regardless of time horizon. For institutional investors, higher-than-expected inflation reduces real returns and makes it difficult to generate long-term forecasts to meet objectives. In all cases, however, inflation—and the threat of persistent inflation that's higher than expected—is a reason to reconsider the traditional asset allocations that only address market environments of the past. Download to read more of our perspectives.