As Fed Eyes Inflation Overshoot, JPMorgan Likes Gold, TIPS
- Some traditional price-pressure hedges may not work currently
- Oil shocks, China credit binge skew historical hedge analysis
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Many assets have been labeled inflation hedgers in market lore, but some of them might not work so well as the Federal Reserve considers trying to let inflation run above target.
Everything from broad stock indexes to agriculture and emerging-market assets has been categorized at times as a refuge from rising prices. Financial stocks could counter rising interest rates, while single commodities or base metals might work because resource scarcity can drive inflation, according to JPMorgan Chase & Co. But based on the firm’s analysis, there are two that stand out as the best choices at the moment.