Monthly Investment Outlook - July 2021

"Uneasy lies the head that wears the crown" can be said of Jay Powell's current plight as the Fed continues its dovish stance on inflation. Following the jump in both the Headline and Core figures in June, there has been much debate around the nature of US inflation - is it transitory or sticky? That is the question.

In this month's memo we:

• Piece together the puzzle of CPI, delving deeper into the data to examine the state of the current US economy and whether inflation is transitory or sticky.

• Examine Housing and Transportation in greater detail.

• Assess the labor market and wage growth.

• Explain why investors should reduce the duration of their Fixed income portfolio and by what timeframe.

• Highlight the possible risks to our view of inflation being sticky