Market insights and analysis

How dynamic, risk-managed investment solutions are performing in the current market environment

4th Quarter | 2023

Quarterly recap



Current market environment performance of dynamic, risk-managed investment solutions.

Inflation spreads

Gold prices retraced back to the resistance/support line, closing last week at $1,648.90 per ounce.

Consumer prices rose 0.4% in September and were up 8.2% from a year ago, according to U.S. Bureau of Labor Statistics data released Thursday (October 13). Excluding food and energy, the core consumer price index (CPI) climbed 0.6% in September and 6.6% from a year ago. The yearly gain for the core CPI was the highest since August 1982, says CNBC.

Various analysts have described the fallout from the report. Jim Caron from Morgan Stanley Investment Management told Bloomberg TV, “It is brutal. ... The issue now is that inflation has moved from the goods sector and has permeated into the services sector."

Steve Chiavarone, senior portfolio manager at Federated Hermes, said, “This report raises the risk that we may see a new cycle high in headline inflation before the end of the year. With energy prices moving back up, a mid-90s oil price in December could see us surpass the 9.1% headline peak from June. Looking at the components, what is most worrying is the big jump in services. Service inflation is the most sticky.”

Neither the drawdown of the nation’s strategic oil reserves to increase supply nor the Federal Reserve’s raising interest rates to depress demand have managed to defeat inflation. With inflation remaining more persistent, gold can make a good addition to a portfolio as it offers a good hedge to inflation over the long term.

Rick Andrews is president of Avant Capital Management.

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