June 19, 2021

Analysis: U.S. investors looking for protection as inflation pressures bubble, stocks volatile

A man points a computer screen showing stock information in this illustration photo taken in Bordeaux, France, March 30, 2016. REUTERS/Regis Duvignau

U.S. investors grappling with the latest stock volatility and evidence of inflation say they have been positioning themselves for more unexpected kinks in the road to recovery.

The moves to hold assets that could withstand a prolonged surge in inflation come as data earlier in the week showed U.S. consumer prices rose by the largest amount in 12 years in April in a jump that was well above Wall Street’s expectations. Bottlenecks in global supply chains and scarcity in the labor market were among the reasons for the surge in prices, Labor Department data showed.

Another wrinkle for investors trying to navigate the economic reopening is the Federal Reserve, which expects a jump in inflation to be “transitory,” meaning it will be slower to…

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