Janus Henderson: A return to the era of 'no inflation' is unlikely any time soon

Janus Henderson: A return to the era of 'no inflation' is unlikely any time soon

August 31, 2023

Inflation
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Marc Schartz, European Equities Portfolio Manager, comments on today’s Eurozone CPI figure:

'Today’s European CPI prints show that inflation is proving sticky. While we can expect some inflationary components, like logistics or material costs, to ease into year-end, we also believe that a return to the era of 'no inflation' is unlikely any time soon. Forecasting precise inflection points or eventual levels of inflation is a tricky business and not at the core of our investment approach.'

'However, given tight labour markets, trends towards onshoring of manufacturing as well as investments required to drive the energy transition, we believe that inflation is likely to remain at meaningful levels for longer. The return of more sustained underlying inflation and hence the end of zero interest rates (i.e. free money) should play out in favour of our investment philosophy that is based on identifying companies with pricing power and robust return generating abilities independent of financial leverage.'

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