Will inflation kill the bull market?

Inflation risks loom in the coming months, but that doesn't signal onset of a bear market

The low base last year and re-opening angsts have caused temporary supply bottlenecks and labour shortages and contributed to higher inflation readings, says the writer.
Financial markets face inflation risks in the coming months, but it does not signal the onset of a bear market, says the writer.PHOTO: REUTERS

Inflation fears have been at the forefront of recent market volatility - and this is likely to continue, and perhaps even intensify, in the second half of this year.

However, it may not derail the stock markets, as the broader macro-outlook is still positive, and valuations are not excessive.

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A version of this article appeared in the print edition of The Straits Times on June 15, 2021, with the headline 'Will inflation kill the bull market?'. Subscribe