BlackRock’s Li Says Markets Underappreciate Inflation Risk

The video discusses the significant inflows into ETFs during the first seven months of 2021, highlighting the market's pro-risk stance due to strong growth dynamics and supportive central bank policies. It also addresses inflation concerns, noting a shift towards a higher inflation regime driven by both short-term and medium-term factors, including supply chain shifts and fiscal dominance. The video concludes with an analysis of the implications for interest rates and the potential for inflation-linked bonds to outperform nominal bonds.

What factors contributed to the increased inflows into ETFs during the first seven months of 2021?

How do central bank policies influence inflation and risk assets according to the text?

Discuss the market's reaction to inflation prints as described in the text.

What is meant by 'fiscal dominance' and how does it relate to inflation?

What are the expected long-term trends in inflation according to the speaker?