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Blokland’s daily sketch

Blokland’s daily sketch

10-07-2020

Is inflation coming?

  • Jeroen Blokland
    Jeroen
    Blokland
    Portfolio Manager

This great chart from Deutsche Bank shows historic spikes in US money supply growth were accompanied by spikes in nominal GDP growth. Real economic activity, often targeted by central banks easing monetary policy, explains part of this relationship, but inflation is an important factor as well. With current money supply growth among the fastest since 1831, the question is if inflation will rebound again this time. With other potentially inflationary factors at work, such as deglobalization, this should not be ruled out. Hence, some focus on ‘inflation-proof’ assets is warranted.

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As a senior portfolio manager I use charts to illustrate financial issues every day. I tweet my favorites as @jsblokland and was named 'one of the 50 most important people for investors to follow in 2018' by MarketWatch.
Previous editions of the daily sketch can be found on my personal financial markets blog. All graphics provided are collected from Bloomberg data and public websites. They do not always reflect my personal opinion and may also not necessarily reflect the opinion of Robeco. Please cite all references or quote the original source if replicating content.

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