The American public and investment professionals grew accustomed to very low inflation that dominated the 13-year period following the 2008 financial crisis — a period that now appears likely to be the exception rather than the rule. Between November 2008 and December 2020, U.S. inflation averaged only 1.6 percent, well below the Federal Reserve’s target of 2 percent and less than half of the post–World War II average of 3.5 percent. This extended low-inflation period shaped assumptions and strategies, particularly in long-term investment planning.
Recent high inflation, peaking at 9.0 percent after the COVID-19 pandemic, however, shocked the public out of its low-rate complacency. Despite recent declines, inflation remains above target, and investors may be facing a prolonged environment of elevated price pressures. While it is important to note that the trajectory of inflation remains uncertain and unexpected factors could reverse inflationary pressure more quickly th
