Understanding Inflation - VP Thematic
> Inflation operates in regimes. Historical case studies and data show that inflation is either anchored or unanchored, and this coincides with political regimes.
> “Transitory” increases in inflation become more persistent when inflation expectations rise too quickly.
> We break down inflation into structural and cyclical drivers. Structural: money supply growth, globalization and technology. Cyclical: leading growth and survey data.
> Broad equity indices deliver poor real returns in unanchored inflation regimes: investors should focus on sector rotation.
> Our Inflation Portfolio of real assets is a holistic portfolio solution in an unanchored inflation regime.
> “Transitory” increases in inflation become more persistent when inflation expectations rise too quickly.
> We break down inflation into structural and cyclical drivers. Structural: money supply growth, globalization and technology. Cyclical: leading growth and survey data.
> Broad equity indices deliver poor real returns in unanchored inflation regimes: investors should focus on sector rotation.
> Our Inflation Portfolio of real assets is a holistic portfolio solution in an unanchored inflation regime.
ThematicVP Understanding
