Equity Market Review: Inflation returns

Research evidence excerpt

Equity Market Review: Inflation returns

Equity Research

Equity Strategy

15 May 2026

Equity Market Review

Inflation returns

Inflation jump puts rate hikes back on the table. Tricky time

for new Fed chair Warsh to take office, but hawkish pivot

unlikely. As UK politics add to bond market woes, strong European Equity Strategy

earnings help equities shrug off rising yields. Value best Emmanuel+44 (0)20 3134Cau,0475CFA

emmanuel.cau@barclays.cominflation hedge, oil drop needed for consumer plays to

bounce. Barclays, UK

Magesh Kumar Chandrasekaran, CFA

+44 (0)20 3134 5983

magesh.kumarchandrasekaran@barclays.com

Weekly market commentary Barclays, UK

Emmanuel Makonga

Inflation returns. The hot CPI and PPI releases this week  Equity Market Review +44 (0)20 7773 2593

added further evidence that inflation is back. Admittedly, emmanuel.makonga@barclays.com Our weekly pack contains key

adjusted for one-off in shelter, the rebound in core CPI was charts on performance valuation Barclays, UK

less impressive, though firmer than our forecast. And and technicals Arihanth Bohra Jain

soaring energy prices are largely to blame for the broad +91 (0)22 6175 1406

based spike in producer prices. Still, with oil prices arihanth.bohrajain@barclays.com

remaining stuck above $100/b and the Hormuz deadlock causing growing supply chain Barclays, UK

disruptions, there has been a complete shift in policy expectations. Fed cuts have been priced

out and the market now expects half a hike by year-end in the US. In Europe, where the ECB talk

has been more hawkish recently, markets are pricing in almost three hikes for 2026. Ironically,

the timing of the new Fed chair Kevin Warsh taking office today could not be better. Surely, he