Inflation continued to rise above market and Federal Reserve expectations in the first half of 2022, persisting at elevated levels last seen in the 1980s. This was contrary to the “transitory inflation” narrative that dominated 2021. Looking ahead, we expect supply/demand dynamics to start normalizing in certain industries, as supply chains heal and less supportive fiscal and monetary policies filter through the economy. In our view, this will reduce year-on-year CPI changes in the coming months. However, we see three forces in place that heighten the risk that high inflation will be an enduring feature of the economy in the years ahead, making it critical for investors to consider the resulting investment implications.
Important Risks: Investing involves risk, including the possible loss of principal.
The views expressed herein are those of Wellington Management, are for informational purposes only, and are subject to change based on prevailing market, economic, and other conditions. The views expressed may not reflect the opinions of Hartford Funds or any other sub-adviser to our funds. They should not be construed as research or investment advice nor should they be considered an offer or solicitation to buy or sell any security. This information is current at the time of writing and may not be reproduced or distributed in whole or in part, for any purpose, without the express written consent of Wellington Management or Hartford Funds.
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