The impact of global inflation on financial markets is a crucial issue in the modern economy. Inflation, which refers to increases in the prices of goods and services, can trigger various reactions in financial markets. One of the direct impacts of inflation is on interest rates. When inflation rises, central banks tend to raise interest rates to curb price growth. This increase in interest rates can reduce the attractiveness of risky assets and move investors to safer assets. Furthermore, global inflation affects currency exchange rates. When inflation increases in a country, the value of that currency can depreciate against other countries’ currencies. A decline in the exchange rate can worsen the trade balance by increasing import prices, which in turn can reduce economic growth. Having a broad impact on the stock market, high inflation tends to suppress company profits. Increased production costs, due to rising raw material and labor prices, often lead to decreased profit margins. Investors who anticipate a decline in profits may sell shares, causing an overall decline in stock prices. On the other hand, inflation can also provide benefits to real assets such as property and commodities. When the value of money declines, these assets typically appreciate in value, enticing investors to shift their portfolios. This increases demand for gold, oil and other commodities often considered a hedge against inflation. Bond investments were also significantly affected. Fixed-rate bonds become less attractive as inflation rises, because the real value of the interest income received decreases. Savvy investors often turn to inflation-protected bonds, such as Treasury Inflation-Protected Securities (TIPS) in the United States, to preserve their buying power. The impact of global inflation is also visible in the geopolitical aspect. Countries experiencing high inflation may be forced to cut public spending to balance the budget, which can create political instability. This instability, in turn, can increase risks for investors, making them more cautious about investing in the country. Overall, the impact of global inflation on financial markets is complex. Although inflation can trigger volatility and uncertainty in the markets, there are also opportunities for profits, especially in certain assets. By understanding these dynamics, investors can make wiser decisions to protect and optimize their portfolios in the face of the threat of inflation. Preparedness and adjustment of investment strategies will be very important in economic conditions experiencing high inflation.