Roaring labor market puts 'boomflation' back on the map for investors
Zip-zap. That’s how fast Wall Street on Friday put aside fears of a stagnant economy and high inflation after a sizzling jobs report for July overshadowed concerns of a shrinking U.S. economy on the brink of a recession.
The worry instead turned to what a rip-roaring labor market and surging costs for everything means for stocks and bond portfolios, particularly if it turns into a mix of higher growth and inflation with staying power.
What to even call such a scenario? “Boomflation,” said Kent Engelke, chief economic strategist at Capitol Securities Management, pointing to yearly wage gains pegged at 5.2% on Friday, which should help fuel growth.
On the gloomier side, however, sits inflation at a 41-year high as of June, which may be even harder to tame after more …
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