If a vaccine is discovered, are interest rates and inflation going to take off? Vice President Steve Johnson looked at what may lay ahead in our recent quarterly webinar*—Take Your Pick: Recession or Recovery?
Please enjoy the excerpt below and click here for the full webinar replay to hear more.
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Steve Johnson: The inflation narrative has been one of the most incorrect I’ve heard ever since the great financial crisis. So many economists and pundits have called for higher rates, higher inflation as well as debasement of the dollar. And what we’ve seen is the dollar has actually increased in value. Interest rates have gone extremely low.
We think, obviously, that if we get a vaccine and the economy starts to recover a little bit more quickly, there is a tremendous amount of pent up demand out there among the consumer. So we may see inflation start to pick up in the latter half of next year, but the Federal Reserve is in no hurry to raise rates at all [any time soon].
*Webinar recorded after the market closed on Wednesday, July 22, 2020.
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