Q: Good afternoon 5i staff
Just a brief addendum to my previous question regarding short or long term bond etf’s are best for today. Many say that Canada’s inflation rate is already rising and that Trump’s policies will push inflation. What I was interested in is why you don’t believe the narrative that we will be facing an inflationary environment.
Thanks
Just a brief addendum to my previous question regarding short or long term bond etf’s are best for today. Many say that Canada’s inflation rate is already rising and that Trump’s policies will push inflation. What I was interested in is why you don’t believe the narrative that we will be facing an inflationary environment.
Thanks
5i Research Answer:
New policies could re-start inflation. But the current trend has indeed been very much 'down' and it is not something that turns quickly. The rate hikes have a lag impact on the economy and are still being felt. Inflation is not something to ignore, but it has gone from 9% to 2% with rate hikes, and with market rates ticking up again it may stay in check for a period of time, or at least rise less than what is feared.