Tactical ETF 3Q21 Market Review & Outlook

October 11, 2021 — While demand is strong and the U.S. consumer is in a healthy position, continued supply-related price pressure on commodities and other goods could eventually damage consumption and give the transitory inflation story more of a structural feel, making the Fed appear behind pace. As it stands, our base case is for inflation and growth to moderate in tandem in the coming quarters, suggesting the Fed taper/tightening path laid out is appropriate. Given our outlook, we remain tilted toward equities in balanced strategies and overweight spread sectors in fixed income.