Rejig your investment portfolio: Inflation has a ripple-like effect. Almost everything in this world is affected a little by the prevalent inflation rate. When banks increase their interest rates aiming to curb inflation, people move their money from the stock markets to debt instruments because now they are getting a higher risk-free return. Businesses, on the other hand, are negatively affected due to higher input costs and lower profits. The stock markets turn bearish during this time. It is advisable to shift some of your funds to commodities, energy (which constitute input costs), and debt instruments till the bulls regain their strength.