The most popular option are Treasury Inflation-Protected Securities (TIPS), which help protect against
unexpected inflation because their interest payments reflect the stated fixed interest plus the inflation amount as measured by the Consumer Price Index (CPI).
After all, bank depositors regularly lose more when
unexpected inflation erodes their savings' real purchasing power (only the nominal value of those deposits is insured).
Bursts of
unexpected inflation redistribute wealth from lenders to borrowers, because each repaid dollar is worth less than when it was borrowed.
Skewness statistics show that
unexpected inflation and changes of expected inflation are positively skewed with the highest positive skewness found in
unexpected inflation and the lowest in changes of expected inflation.
We then examine the relation between the world budget surplus factor and estimated world factors in national output gaps, equity valuation ratios,
unexpected inflation, and military spending.
As a result of
unexpected inflation risks, UK interest rate expectations for this year were themselves pushed back and traders began to close GBP positions.
Inflation and
unexpected inflation are negatively related to insolvency, which rejects Hypothesis 8 (inflation cost hypothesis).
expected inflation
unexpected inflation or inflation uncertainty.
1990) have offered empirical evidence of US REITs are significantly and negatively related to both expected and
unexpected inflation.
In the meantime, while inflation continues to be muted, the risk of
unexpected inflation remains elevated.
In other words, the interest rate on the nominal bond is the real rate, plus the expected inflation rate, plus a risk premium for
unexpected inflation.
Adams et al (2004) found a negative relationship between
unexpected inflation and stock prices.
