In the Federal Reserve’s address to the United States in February, Chairman Jerome Powell said, “The disinflationary process, the process of getting inflation down, has begun and it’s begun in the goods sector, which is about a quarter of our economy.” This messaging and tone are unusual for Powell, who raised interest rates 7 times in 2022 due to challenges with inflation.
Immediately, trading markets reacted well and the overall tone amongst financial investors was ignited with hope that global economic catastrophe might not advance as many expected. However, it’s important to consider that we live in a global economy, and countries like Chile and Laos are still seeing jumps month-over-month in their inflation numbers.
Global events and macroeconomic swings are still impacting markets on a country-by-country basis, with many leaders waiting for another shoe to drop. Will a new Covid outbreak sweep the globe? Will Russia’s war in Ukraine disrupt oil and gas prices even further? In the name of transparency, there are still many unknowns about what we’re up against, but positive news in the US provides a hopeful glimmer of changing tides.
Just as we have through the trials of the last few years, the team at Hewwest will continue to protect our client’s portfolios from inflation, offer hedging methods, and provide financial safeguards. We stand by our long-term investment approach and will continue to analyze data and utilize all the resources at our disposal to help our clients reach their financial goals.
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