The expected surge in demand and prices was reported for March.

Two data points released last week highlight the issues for investors over the next two years. The first data point was the CPI index for March. The overall index was up 0.6% for the month, and this caused the year-over-year increase to jump to 2.6%, the highest twelve-month total in the last ten years. This is well above the Fed’s target of 2.0%. However, the Fed has repeatedly said they expect a surge in inflation, but it would be temporary and not cause them to change monetary policy in the short term. Chairman Powell has said the Fed would wait for hard data before considering any changes, and that they would not act on forecasts.