Increasing Inflation

The combination of the $900 billion support package signed by President Trump in December, the virtual certainty of another $1.9 trillion Democratic aid package, the probability of a large infrastructure/stimulus bill in February, and the Fed’s desire to keep rates artificially low, along with increased household spending due to high savings rates from prolonged pent-up demand, raises inflationary concerns. The Fed may have to work very hard to repress yields.

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