EXPERTS AGREE: TRANSITORY INFLATION IS NOT A WORRY

Experts in economics and business agree that slight upticks in consumer prices are both predicted and transitory. 

  • Chief Financial Officer at Goldman Sachs, Stephen Scherr: “Our collective view here is that what we’re seeing by way of inflation and price pressure is more transitory than it is permanent.” [CNBC, 6/10/21]

  • Chief Economist and Macro Strategist at Quintet Private Bank, Daniele Antonucci: “That US consumer prices accelerated the most in almost 13 years surely makes an eye-catching headline. However, rather than a generalised spiral, this looks mostly driven by pent-up demand combined with transitory supply bottlenecks as the US economy reopens – especially for a few categories such as like rental cars, hotels and flights.” [The Guardian, 6/10/21]

  • Senior Economist at AllianceBernstein, Eric Wingorad: “The strength in the top line indices was driven largely by categories that have been heavily disrupted by COVID and remain under pressure from supply chain disruptions. The more persistent categories of inflation — the ones that do a better job of capturing the sustainable trend—are significantly more subdued. That means that the details of today’s print continue to support the idea that the spike in inflation is transitory, even if it is more intense than most forecasters (myself included) would originally have anticipated.” [CNBC, 6/10/21]

  • Senior Global Investment Analyst for Commonwealth Financial Network, Anu Gaggar: “The belief remains that these are cyclical pressures that are to be expected when an economy is in the early stages of a strong rebound. As the cycle matures, these inflation pressures will subside owing to the structural forces that have kept inflation low for long.” [TheStreet, 6/11/21]

  • Wells Fargo Bond Strategists: “Airfares, hotels and event admissions all registered big price increases and contributed to the spike in CPI inflation in April. But these categories are merely recovering declines seen last year, and the Fed is unlikely to be swayed if their prices continue to accelerate. Rent, owners’ equivalent rent and medical care services (collectively 50% of the core CPI basket) inflation are muted.” [CNBC, 6/9/21]

  • Head of U.S. Equities and Co-Head of Multi-Asset Investing at Lazard Asset Management, Ron Temple: “I think inflation is the thing people want to be afraid of…I think it’s a misplaced fear. I think the worst thing we could have is deflation.” [CNBC, 6/9/21]

  • Ben Ayers, Senior Economist of Nationwide Economics: “This is likely to be the peak for annual inflation readings, which should fade slowly over the next year back towards the pre-Covid trend.” [Marketwatch, 6/10/21]

  • Bill Adams, Senior Economist of PNC Financial Services: “Consumer spending is recovering faster than the economy’s productive capacity in some sectors, temporarily pushing inflation higher.” [Marketwatch, 6/10/21]

  • Mark Zandi, Chief Economist at Moody’s Analytics: “The price spikes could be bigger and more prolonged because the pandemic has been so disruptive to supply chains. By the fall or end of the year prices will be coming back to earth.” [USAToday, 6/10/21]

 

###