Week of 11 - 15 May 2026 |  Inflation question haunts the market

In this edition of Amundi's Weekly Market Directions: 

• US input price inflation accelerated in April, coming in significantly above market expectations.
• Bond yields, particularly short-dated ones, are moving higher owing to higher near-term inflation expectations. Additionally, a recent auction of 30-year USTs was completed at yields close to 5%, for the first time since 2007.
• We think the Fed would like to balance the need to control inflation with any potential fragilities in the economy.

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Monica Defend

Monica Defend

Head of Amundi Investment Institute

While markets are rightly focusing on price pressures in the US, the impact on consumption should not be underestimated. The Fed would prefer to manage this double whammy by keeping inflation expectations anchored and by refraining from rate hikes if the economic outlook deteriorates.

Monica Defend, Head of Amundi Investment Institute

Read the full weekly market directions

*Diversification does not guarantee a profit or protect against a loss. 

Unless otherwise stated, all information contained in this document is from Amundi Asset Management S.A.S. and is as of 15 May 2026. Diversification does not guarantee a profit or protect against a loss. The views expressed regarding market and economic trends are those of the author and not necessarily Amundi Asset Management S.A.S. and are subject to change at any time based on market and other conditions, and there can be no assurance that countries, markets or sectors will perform as expected. These views should not be relied upon as investment advice, a security recommendation, or as an indication of trading for any Amundi product. This material does not constitute an offer or solicitation to buy or sell any security, fund units or services. Investment involves risks, including market, political, liquidity and currency risks. Past performance is not a guarantee or indicative of future results.
 

Date of first use: 15 May 2026

Doc ID: 5495861