How to Find the Best Stocks for Inflation

Inflation has been an unavoidable topic for investors in 2022, and it may not go away anytime soon. Today, the Bureau of Labor Statistics released the latest Consumer Price Index, or CPI, numbers. They showed a year-over-year inflation rate of 8.2% for the month of September — far higher than the Federal Reserve’s 2% target.

High inflation hurts investors in a couple of different ways, according to financial advisors. But it also affects some stocks less than others, and it can even be good for certain sectors of the market.

Here’s what advisors say about investing during periods of high inflation, and how to find the best stocks for inflation.

How does inflation affect stocks?

Advisors say that excessive inflation has two major effects on investors: It reduces the value of their money over time, and it motivates the Federal Reserve to take counter-inflationary actions — like interest rate increases — which can push down stock and bond prices.

“Let’s say you have money in…

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This article was written by Sam Taube and originally published on www.nerdwallet.com