U.S. 60/40 Portfolio Real Returns and U.S. CPI Inflation Above 3% and Rising 60/40 portfolios tend to suffer when inflation is above 3% and rising. Image: Goldman Sachs Global Investment Research
U.S. ISM Manufacturing Index vs. U.S. Core CPI (Core Inflation Leading Indicator) U.S. annual core CPI at 1.4% in January. The U.S. ISM Manufacturing Index tends to lead U.S. Core CPI by 24 months. You may also like “ISM Manufacturing Index vs. S&P 500 Index” and “U.S. Core Inflation Expected Over the Next 21 Months.“…
S&P 500 Deflated by CPI and Trend Is the S&P 500 in a bubble disconnected from reality? Image: BCA Research
U.S. Money Supply M2 and CPI Inflation The increase in the money supply (M2) tends to lead to higher inflation. Image: Financial Times
Emerging Markets Total Return Index (Equities Relative to Bonds) and OECD Core CPI (Leading Indicator) Emerging markets equities relative to bonds tend to lead OECD core CPI by 40 weeks. Image: BCA Research
U.S. 10-Year Yield vs. GDP + CPI Model Fair Value Are higher Treasury yields coming, as suggested by this model? Image: TS Lombard
Inflation – S&P 500 LTM Sales Growth vs. Core CPI Since 1970 Rising inflation tends to boost S&P 500 earnings. According to Goldman Sachs, a 100bp increase in average annual core CPI would lift the S&P 500 EPS to $170 in 2021. Image: Goldman Sachs Global Investment Research
CPI vs. Conference Board Inflation Expectations Coordinated monetary and fiscal easing should lift inflation higher in this cycle. Image: Pantheon Macroeconomics
WTI Crude Oil and Headline CPI Inflation This chart suggests that falling oil prices could easily lead to deflation. Image: J.P. Morgan
U.S. Inflation – Probability Headline CPI Exceeds 2.0% YoY U.S. inflation expectations are rebounding for the first time this year. Image: Arbor Research & Trading LLC