The US Federal Reserve (Fed) is largely unperturbed by rising inflation. Bond markets concur, but some investors fear that this could prove complacent -- and costly.
- The price of bitcoin fell by 30% since mid-April to USD20,000, partly due to doubts of whether the token is maturing into a stable asset.
- US banking stocks have surged by over 70% since the vaccine breakthrough on average; strong first-quarter earnings will fuel further upside.
- Markets have confidence in the Fed, but investors’ fears of a more sustained increase in prices, and of the Fed falling behind, will rise.