us inflation has peaked but the stock market is still looking for a bottom stock market bulls confidently predict that the us market will rally the instant the federal reserve pauses in its battle against inflation yet it hasnt always worked out that way a review of past cycles of inflation interest rates and the us stock market reveals that there can be a considerable lag between peak inflation peak interest rates and the stock markets low and by considerable i mean months if not years consider the period in the early 1980s when inflation and interest rates peaked and the bear market in us stocks came to an end inflation topped out more than a year before interest rates did and over two years before the stock market bottomed this history is illustrated in the table above peak us inflation in the early 1980s was reached in march 1980 when the cpis 12month rate of change hit 148 in january 1981 nine months later the federal funds rate peaked at 201 it wasnt until sept 30 1981  18 months later  that the 10year treasury yield topped out at 158 stock market investors waited even longer for the bottom of the bear market on aug 12 1982 the stock market hit its low  two years and five months after inflation peaked at that low the cpis 12month rate of change was almost 9 percentage points lower than it was in march 1980 the fed funds rate was more than 9 percentage points below its peak and the 10year treasury yield was nearly three percentage points below its peak just nine months have passed since us inflation peaked last june at 91 inflation now is running at an annual rate of 5 based on the release this week of the march cpi data thats far less than the 29 months it took between peak inflation in 1980 and the bearmarket bottom in august 1982 but still should give the bulls pause mark hulbert is a regular contributor to marketwatch his hulbert ratings tracks investment newsletters that pay a flat fee to be audited he can be reached at markhulbertratingscom more3 sp 500 sectors say a new bull market is near these 8 stocks are top picks also read ibonds are over long live ibonds this is your warning that rates are about to drop precipitously this content was created by marketwatch which is operated by dow jones  co marketwatch is published independently from dow jones newswires and the wall street journal