Stagflation and Why Nikkei 225 Trails U.S. Stocks Nov 15, 2021 View in your browser Is Economy Headed for Stagflation?; Nikkei 225 Trails Soaring U.S. Stocks By Blu Putnam, Chief Economist Erik Norland, Senior Economist CME Group A Return to Stagflation of the 1970s? Inflation in the 1970s peaked above 10%, averaged 7.8% from 1976 to 1979. Current inflation rate of about 5% lags the trend in the 1970s. Unemployment averaged 6.7% from 1976 to 1979 vs. 4.6% in September 2021. Growth slowed in Q3 2021, but rebound from the pandemic continues. Watch video Nikkei 225 Is Trading One-Third Below 1989 Peak Nikkei 225 is underperforming record-setting U.S. stocks. Japanese stocks record higher earnings yields than their U.S. counterparts. Japanese stocks have better price-to-book ratio than U.S. counterparts. Poor performance of Nikkei could be due to slow growth, mild deflation. Read article SEE MORE ANNOUNCEMENTS