Watch Insurance for Signs of Inflation
Investors looking for signs of inflation pressure may want to keep an eye on the cost of insuring a car or home. The Wall Street Journal reports that during the pandemic, auto insurers lowered premiums for customers who were driving less as accident frequency declined. However, as life in the United States begins to return to normal, consumers' motor-vehicle insurance costs are again rising.
The recent U.S. consumer-price index update had that component up 6.1 percent in April from a year earlier, ending a long string of decreases and jumping the most since 2018. Fitch Ratings earlier this month noted long-term challenges in the severity of losses for commercial auto coverage, such as more sophisticated technology and components within vehicles that make repairs and replacement more costly.
At The Wall Street Journal’s CEO Council Summit, Treasury Secretary Janet Yellen expressed her confidence that the U.S. economy and employment will return to normal by next year.