A majority of CFA Institute members and charterholders anticipate inflationary pressures over the next three years, a survey from the investment professional association says.
Approximately 65% of the 6,040 respondents to a survey in March say that accommodative monetary policies will cause inflationary pressures in the next three years.
As shown in the survey report, "COVID-19: One Year Later, Capital Markets Entering Uncharted Waters," a majority of respondents also believe the role of government will continue to expand as a result of the COVID-19 pandemic when asked for the main structural consequences either caused or accelerated by the crisis.
Some 58% agree that the government's role will broaden and the share of government spending in gross domestic product will "structurally and materially rise," according to the report. The next highest response — 40% — came from respondents who believe the trend toward environmental, social and governance products is here to stay.
Thirty-four percent believed a small number of Big Tech stocks would continue to dominate the markets. Multiple answers were accepted.
When asked how they feel about the extreme market volatility since the beginning of the pandemic, 48% of global respondents say it has had no significant impact on their or their firms' activity.
"Across markets, we are clearly seeing signs of a multispeed recovery together with inflationary pressures, a potential for monetary stimulus addiction, tax hikes, emerging regulatory risks, and questions over the actual financial health of corporates," said Olivier Fines, head of advocacy and capital markets policy research for EMEA at CFA Institute and lead author of the survey report, in a news release. "As our survey reveals, while many governments and central banks have implemented robust and comprehensive plans to meet the crisis head on, concerns are rising as to the eventual unintended consequences of this liquidity infusion."