High asset prices, not low interest rates, are driving inflation - Financial Times

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Published: 2026-08-24
Category: finance
Source: Financial Times

An analysis suggests that elevated asset prices, rather than low interest rates, are the primary driver of inflation, particularly in sectors like housing, restaurants, and travel where demand is linked to wealth. To achieve its inflation target, Federal Reserve Chair Kevin Warsh may need to focus on slowing the growth in asset prices, as returns are increasingly influenced by abundant Fed liquidity and corporate borrowing.

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