Earlier this year, PGIM Fixed Income developed an inflation indicator tool that uses various economic variables to segregate the supply factors that explain the change in inflation, from those associated with demand. The end result helps us gain insight into the future direction of core goods inflation. On this episode of All the Credit®, Guillermo Felices, PhD, Global Investment Strategist, explains our proprietary inflation model and reviews the findings. Guillermo also:
- provides an update on the direction and level of inflation that we’re expecting over the next year;
- delves into the policy implications and highlights the macroeconomic scenarios we envision for 2023; and
- shares our views on the level of interest rates in each of these potential scenarios.
Recorded on December 9, 2022.