Recent CPI Data Reinforces Need for Inflation-Fighting Assets>
The latest U.S. Consumer Price Index (CPI) report for January 2025 revealed a higher-than-expected inflation rate of 3.0% annually, with a sharp monthly increase of 0.5%. This persistent inflationary pressure was heavily influenced by energy prices. The energy index rose by 1.1% in January, with gasoline prices climbing by 1.8%. Higher fuel costs impact many industries across the economy, leading to increased prices for consumers. Additionally, geopolitical tensions and fluctuating oil supplies are adding to the uncertainty in energy markets.
Persistent Inflation Influencing Markets
Year-Over-Year % Change
Source: U.S. Bureau of Labor Statistics via FRED® as of 2/12/2025.
Inflation is also creating price swings in key commodities. Precious metals like gold and silver are gaining as investors seek inflation hedges. Industrial metals such as copper and aluminum are also seeing price increases due to high demand and supply constraints. In agriculture, rising costs for fuel and fertilizers are pushing food prices higher, further burdening consumers.
New tariff policies are another factor driving up costs for industries that rely on imported raw materials. While some domestic businesses benefit from these protections, supply chain disruptions and increased production expenses could add to inflation over time. This uncertainty makes it harder for businesses to plan and for investors to predict long-term market trends.
Natural Resources Equities Can Serve as an Inflation Hedge
Natural resources companies are well positioned to act as a hedge against inflation, outperforming U.S. stocks and bonds. Even in periods of modest inflation (2-6%), global resources have outperformed U.S. stocks broadly.
Average 12-Month Return in Varying Inflation Regimes
Diversified Miners” represented MSCI ACWI Select Metals & Mining Producers ex. Gold & Silver Index from Sep-2001 to present, EMIX Global Mining ex. Gold & Energy Index from Jan-1986 to Aug-2001, and CRSP - 48 Industry Portfolios (Mines, Average Value Weighted) returns from Jan-1970 to Dec-1985. “Energy Producers” represented by MSCI ACWI Select Energy Producers Index from Sep-2001 to present, EMIX Global Energy Index from Jan-1986 to Aug-2001, and CRSP - 10 Industry Portfolios (Energy, Average Value Weighted) returns from Jan-1970 to Dec-1985. “Gold Miners” represented by NYSE Arca Gold Miners Index from Oct-1993 to present and CRSP’s - 48 Industry Portfolios (Gold, Average Value Weighted) returns from Jan-1970 to Sep-1993. “REITs” represented by FTSE NAREIT All Equity REITs Index (note: index inception is Jan-1972). “U.S. Bonds” Bloomberg U.S. Aggregate Bond Index from Jan-1976 to present, Bloomberg U.S. Aggregate Government/Credit Index from Jan-1973 to Dec-1976 and a blend of Ibbotson's SBBI U.S. 1 Year Treasury Index, U.S. Intermediate-Term Government Bond Index, U.S. Long-Term Government Bond Index, and U.S. Long-Term Corporate Bond Index series from Jan 1970 to Dec-1971. “U.S. Equities” represented by S&P 500 Index.
Source: VanEck, Bloomberg, CRSP, FactSet, World Bank. Data as of December 2024. Past performance is no indication of future results. Please see additional definitions and index descriptions at the end of this presentation.
VanEck Inflation-Fighting Investment Opportunities
Comprehensive Index-Based Exposure
VanEck Natural Resources Fund (HAP) offers diversified exposure to companies engaged in energy, metals, and agriculture, providing investors with a hedge against inflation while benefiting from global demand for essential commodities. Additionally, HAP's diversified portfolio helps mitigate risks from individual commodity price fluctuations, making it a compelling option for investors seeking low-cost exposure to global natural resources.
Actively Managed, Broad-Based Exposure from Proven Team
VanEck Global Resources Fund (GHAAX) provides investors with broad exposure to energy, metals, agriculture, alternative energy, and other resources, supported by a deep bench of portfolio managers and investment analysts with real-world engineering and geological experience backed by a research-driven, risk-managed investment approach.
Broad Real Assets Exposure that Takes Care of the Allocation Decisions for You
VanEck Real Assets ETF (RAAX) provides exposure to key inflation-fighting investments, adapting to different inflation levels and changing risks. RAAX invests across real assets including natural resources equities, commodities and income assets such as real estate, infrastructure and MLPs.
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