In the US, inflation has hit its highest level in 41 years of 8.6%.
Because of the surge in the prices of goods and services, the US central bank plans to raise interest rates aggressively in the coming months. Just how badly will inflation and interest rates impact your wealth? Let’s analyse each attribute to see its effects.In turn, this phenomenon lowers consumer demand as people tighten their wallets due to pricier goods.
Many companies will experience some form of lower demand as higher prices tend to crimp consumer sentiment.However, another problem now arises – that of higher staff costs that eat into operating and net profits. That’s why you should be looking at two kinds of businesses that are relatively insulated from inflation.Even when prices rise, people will find it tough to cut back, thus allowing these types of companies to enjoy should remain relatively insulated from rising prices as its business involves the sale of fresh foods and necessities.