Franklin D. Roosevelt expects global inflation to remain high for several years and is positioning his portfolio to buy inflation swaps.

As the full impact of the destruction of Middle East energy infrastructure gradually becomes apparent, Chris Siniakov of Franklin Templeton predicts that global inflation will remain high in the medium term. Siniakov, fixed income manager at the company's Australian division, stated that he has increased his holdings of five-year US inflation swaps in the past month, expecting consumer prices to accelerate. He pointed out that it may take several months for oil transportation to return to pre-war levels, and services such as Uber have already started adding fuel surcharges, indicating that cost pressures are being passed on to consumers. "This won't be solved quickly," Siniakov said. He stated that we have not paid enough attention to the medium-term inflationary pressures that this issue could bring. Siniakov mentioned that he bought five-year US inflation swaps, expecting their rates to rise to around 3% to 3.25%. The current rate is around 2.59%, and the last time it was above 3% was at the beginning of the 2022 Russia-Ukraine war.