Weekly Commentary: Wage-price spiral ahead? Not really

We don’t see a wage-price spiral. Companies are actually paying less in labor per unit of output, we find. We think wages can rise more without adding to inflation. The S&P 500 plunged to new 2022 lows last week. We remain overweight equities in the inflationary backdrop but acknowledge mounting challenges. The Fed is set to raise its policy rate by 0.5% this week in an attempt to rein in inflation. We think the eventual sum total of rates hikes will be historically low.