Interest rate hikes are on the horizon in the United States. To help put the impact in perspective, Josh Scoville, senior managing director of the Proprietary Research Group at Hines, has published a new HinesView paper that examines past periods of tightening cycles to better understand what potential Central Bank moves might mean for commercial real estate fundamentals and capital markets.
The initial burst of inflation in many western countries was largely driven by so-called base effects as prices were being compared to artificially low prices in 2020 due to the dramatic disruption of aggregate demand. The current persistent cost increases in the price of energy and continued supply shortages in many industries have made inflation stickier than initially expected.
In addition, in many economies, particularly in Europe, inflation will be further exacerbated by the crisis in Ukraine.
Read Josh’s key takeaways in our HinesView, "The U.S. Federal Reserve is About to Raise Rates: Keep Calm."