Cathie Wood believes that ‘inflation peaked’

Sep. 27, 2022 9:18 AM ETARK Innovation ETF (ARKK), ARKW, ARKG, ARKQARKF, ARKXBy: Jason Capul, SA News Editor124 Comments

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Cathie Wood, CEO and CIO of ARK Invest outlined to investors that she believes that markets are currently in a recession and that inflation has peaked on Tuesday.

Wood said in an interview “We think we are in a recession.” The innovation bull also stated that “yes inflation peaked, we believe core inflation peaked at 5.3%.” Wood expanded on her thoughts adding “we think that inflation during the years ahead is going to surprise significantly on the low side of expectations.”

At the moment CPI Y/Y sits at 8.3% while interest rates have settled in at 3.25%. Wood remains in the camp that “deflation” remains the greater market risk and that the Fed is using lagging indicators to balance future inflation forecasts.

Moreover, Wood also put out a tweet on Monday stating: “The yield curve 'suggests' that US monetary policy has not been this restrictive since the ‘80s.”

“In ARKInvest’s view, US monetary policy is significantly more restrictive than in the ‘80s when, to kill inflation, Fed Chair Volcker pushed the Fed funds rate up two-fold from 10% to 20%. Chair Powell and team have increased it 13-fold from 0.25% to 3.25% to slay the dragon.”

Wood’s innovative ETFs along with their year-to-date price action: (NYSEARCA:ARKK) -61.4%, (NYSEARCA:ARKW) -62.2%, (ARKF) -62.8%, (BATS:ARKG) -50.1%, (BATS:ARKQ) -41.6%, and (ARKX) -33.5%.

Wood also put out another tweet recently highlighting the fact that she believes the Fed is miscalculating inflation and is making a mistake.

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