Investors are pouring money into mutual funds and exchange traded funds that hold inflation-protected bonds and commodities as protection against inflation.
The worry is that the massive fiscal and monetary stimulus implemented to fight the recession won’t be withdrawn quickly enough to avoid a jump in inflation.
In November alone, investors allocated $3.9 billion to commodity-related mutual funds and ETFs and $2 billion to mutual funds holding inflation-protected bonds, according to research firm Morningstar.
Even stock funds are seeking hedges against inflation, putting money into basic materials companies and companies that can raise prices. (more)
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