"You have the government balance sheet that's deteriorated over time, and you have corporate balance sheets that, in a lot of cases, remain strong and stable."

Real GDP expanded 2.1% on an annualized basis in Q1/2026, topping economists' forecast for a 1.7% increase.

The head of BofA's commodities and derivatives research underscores the potential for persistent economic disruption from higher-for-longer prices after the Iran war spurred an 80% run-up in oil prices this year.

The PPI data reinforces Federal Reserve officials' views that inflation should remain their top concern in the face of the war-driven surge in oil prices.