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Inflation surpasses coronavirus as investors' biggest worry

17 March 2021
Dan Ackermann
Data: Federal Reserve Bank of St. Louis; Chart: Axios Visuals

Inflation is the number one risk for the market, according to a monthly survey of global asset managers commissioned by Bank of America, displacing COVID-19 for the first time since February 2020.

Details: Both inflation (37% of respondents) and the risk of a market taper tantrum (35%) beat out the pandemic as the top risk for investors.

  • COVID-19 and the vaccine rollout dropped from being seen as the biggest risk by nearly 30% of respondents in February to less than 15% in March.

One level deeper: A net 93% of investors in the survey expect inflation to rise in the next 12 months, up 7 percentage points from last month and the highest reading in the history of the survey, which dates back to at least 1995.

  • 53% of fund managers expect above-trend inflation along with above-trend growth over the next year, the first time that has happened since March 2011 and the third time in the history of the survey.

By the numbers: That matches up with sky-rocketing market gauges of inflation expectations that have jumped to yearslong highs in recent days.

  • The 5-year breakeven inflation rate jumped to 2.59% on Tuesday, the highest since July 2008.
  • The 10-year breakeven rate hit 2.30%, the highest since January 2014.

Of note: The survey also found fund managers were incredibly bullish, with 91% of respondents expecting a stronger economy, the highest result on record.

Transcripts show George Floyd told police "I can't breathe" over 20 times

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Newly released transcripts of bodycam footage from the Minneapolis Police Department show that George Floyd told officers he could not breathe more than 20 times in the moments leading up to his death.

Why it matters: Floyd's killing sparked a national wave of Black Lives Matter protests and an ongoing reckoning over systemic racism in the United States. The transcripts "offer one the most thorough and dramatic accounts" before Floyd's death, The New York Times writes.

The state of play: The transcripts were released as former officer Thomas Lane seeks to have the charges that he aided in Floyd's death thrown out in court, per the Times. He is one of four officers who have been charged.

  • The filings also include a 60-page transcript of an interview with Lane. He said he "felt maybe that something was going on" when asked if he believed that Floyd was having a medical emergency at the time.

What the transcripts say:

  • Floyd told the officers he was claustrophobic as they tried to get him into the squad car.
  • The transcripts also show Floyd saying, "Momma, I love you. Tell my kids I love them. I'm dead."
  • Former officer Derek Chauvin, who had his knee on Floyd's neck for over eight minutes, told Floyd, "Then stop talking, stop yelling, it takes a heck of a lot of oxygen to talk."

Read the transcripts via DocumentCloud.