Richmond Fed President Thomas Barkin said with initial slow vaccine distribution. a full return to normal “won’t be until sometime this summer at best”. Though, “I expect the second half of the year to be robust as businesses finally pull the trigger and return to the workplace and consumers with elevated savings unlock pent-up demand,” he added.
Barkin also noted, “I am encouraged to see the rise in market indicators of inflation expectations. … That is what we are trying to support”. Recent rise in bond yields was part of a “reflation trade”, as investors were pricing in future rise in prices.
