Financial Planning Investment

Investing During Periods of Inflation

What does inflation mean for your investments?

In August of 2020, the Fed announced that it is willing to allow inflation to run higher than normal in order to support the labor market and broader economy. This major policy shift allows inflation to run above the Fed’s 2% goal for some time before the Fed would consider increasing short-term interest rates in an attempt to combat higher prices.1


These robust changes to the Fed’s long-standing inflation policy further illustrates the importance of understanding how inflation is reported and how it can affect your investments.






As inflation rises and falls, three notable effects are observed:









Empower Yourself with a Trusted Professional. When inflation is low, it’s easy to overlook how rising prices are affecting a household budget. On the other hand, when inflation trends higher, it may be tempting to make more sweeping changes in response to increasing prices. The best approach may be to reach out to your financial professional to help you develop an investment strategy that takes both possible scenarios into account.


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1., March 12, 2021

2. Tourism,AZ.Gov, 2021


BCJ FG 21-33

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