Published on 24 Mar 2023 on Zacks via Yahoo Finance

4 Inflation-Proof Sector ETFs to Play

Red-hot inflation reading has been hitting headlines across the developed markets for more than a year. Though price levels started cooling this year, the figure is still stubborn. The annual inflation rate in the United States slowed to 6% in February of 2023, the lowest since September of 2021, in line with market forecasts, and compared to 6.4% in January.

Though the Fed hiked rates by only 25 bps this week to 4.75%-5.00% and softened its hawkish tone, the U.S. Central bank chief clearly stated that inflation is still “elevated.” The Fed also indicated that “some additional policy firming may be appropriate.”

But then, the U.S. banking crisis has led the Fed to opt for a less-hawkish move in the coming days. The forward outlook, based on a median survey of FOMC members, expects only one more 25 bps hike throughout the rest of 2023, 75 bps in decreases by the end of 2024 and 125 bps in drops by 2025 end (read: Is it Time for Growth ETFs as Fed Softens Hawkish Tone?).