Inflation pressures will remain high with the rise in commodity markets from the war.

A disconnect between economic fundamentals and valuations in financial assets creates difficulty for any forecasts. The economic data continues to come in stronger than most expectations. Nonfarm payrolls grew by 678,000 in February, well above expectations. The unemployment rate dropped to 3.8%, down from 4.0%. The number of people reported as having a job increased much more than the growth in the labor force. The ISM Index increased, indicating manufacturing and industrial production will continue to expand through the end of the year. More sectors of the economy are opening as the infection rate for the virus comes down. Inflation pressures increased with commodity prices, including agricultural commodities driven higher by economic sanctions on Russia.