Buckle Up! We Just Entered the Next Phase of Trumpflation.
Yahoo Finance ·
It's shaping up to be another sensational year for equities. In early June, the Dow Jones Industrial Average ( ^DJI 0.03% ) , S&P 500 ( ^GSPC 0.22% ) , and Nasdaq Composite ( ^IXIC 0.66% ) romped to record highs on the heels of artificial intelligence (AI) euphoria. But this rally may be more fragile than Wall Street's major indexes suggest. Inflation is the proverbial torpedo that can sink Wall Street's ship, and we appear to have entered the next phase of Trumpflation . Inflation has soared on the heels of two of Donald Trump's policies. Image source: Official White House Photo by Molly Riley. To preface this discussion, a modest level of inflation is normal and healthy for the U.S. economy. But when prices rise quickly or move beyond subjective "modest" levels, it can upend the economy and/or the stock market. As of May 2026, U.S. inflation is at a three-year high. The bulk of this year's inflationary surge has been driven by two decisions from President Donald Trump (i.e., "Trumpflation"). The first policy, implementing sweeping global tariffs , has placed modest upward pressure on prices for select goods.
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