- Investors should be cautious as inflation remains a risk, according to Deutsche Bank.
- They outlined five reasons why consumer prices may stay high.
- Key factors include increased commodity prices, Fed rate cuts, and growing money supply.
Despite recent Fed rate cuts, Deutsche Bank warns inflation isn’t under control yet. Prices are still higher than expected, which could impact markets significantly.
Here are five reasons to watch inflation risks:
- Global interest-rate cuts are deeper than anticipated. The Fed has reduced rates more aggressively, which historically suggests caution regarding inflation.
- Commodity prices are rising. Recent geopolitical tensions have caused oil and other commodity prices to surge.
- US recession fears are fading. Economic resilience may lead to sustained inflation.
- Unexpected high inflation in September. Recent reports showed core CPI increasing more than expected.
- Money supply growth continues to rise. An increase in money supply often signals persistent inflation risks.
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