Fear of inflation has a partisan flavor: People tend to feel better about economic prospects when their political party is in power and worse when it isn’t.
If investors behaved that way, dread would be registering in the corner of the credit market where the fearful can buy insurance against runaway inflation. After all, the U.S. Personal Consumption Expenditure Core Price Index and Consumer Price Index Urban Consumers Index climbed to 30-year highs of 4.1% and 6.2%, respectively, in 2021. Republicans are using the specter of unchecked inflation to bash President Joe Biden, and plenty of Democrats are jittery, too.
