Nomura Says US Money Supply Plunge Is ‘Elephant in the Room’ for Markets
- Markets overlooking M2 as inflation sign, says Inguscio
- Implies Fed should pause quantitative tightening, he added
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A Nomura Holdings Inc. strategist is warning that investors are overlooking a crucial clue as they grapple with the path of US inflation and the Federal Reserve’s response.
The growth rate of M2, which measures cash in circulation plus dollars in bank and money-market accounts, spiked during the pandemic as emergency funding from the US central bank sluiced through the economy.