Inflation is easing at a faster pace than expected. This definitely comes as a major relief to millions of consumers who were concerned that the U.S. economy might slip into a recession, especially due to the tariffs introduced by President Donald Trump.

However, these concerns have eased significantly over the past month, following a temporary pause on the tariffs and a breakthrough trade agreement between the United States and China.

This renewed optimism is fueling investor confidence, making it a favorable time to consider investing in large-cap growth funds. Three such funds are T. Rowe Price Lrg Cp Gr I (TRLGX Quick QuoteTRLGX - Free Report) , T. Rowe Price Blue Chip Growth (TRBCX Quick QuoteTRBCX - Free Report) and Fidelity Contrafund (FCNTX Quick QuoteFCNTX - Free Report) .

Inflation Cools in May

The consumer price index (CPI) rose a meager 0.1% in May on a month-over-month basis, which was lower than the consensus estimate of a jump of 0.2%, the Commerce Department said last week. On a yearly basis, CPI climbed 2.4%, which was in line with the consensus estimate. Core CPI, which strips out the volatile food and energy prices, also rose 0.1% month over month and 2.8% year over year, both below expectations.

A major contributor to the decline was a 1% drop in energy prices. Prices for both new and used vehicles also decreased, by 0.3% and 0.5%, respectively. On the other hand, average hourly wages increased by 0.3% month over month and 1.4% year over year.

Hopes for Rate Cuts Grow as Trade Pressures Ease

Trump has repeatedly urged the Federal Reserve to lower interest rates to stimulate growth. Although the Fed has remained cautious, it last cut rates by 25 basis points in December and paused further changes due to rising inflation. Now that inflation is easing, investors are increasingly confident that the Fed might resume rate cuts — possibly starting in September, with two 25-basis-point reductions expected this year.

Furthermore, the easing of trade tensions, highlighted by the recent U.S.-China deal, is contributing to the positive outlook. Ongoing talks with other nations also suggest that more trade agreements could be finalized soon, reinforcing the current momentum in the market.

Large-Cap Growth Funds With Upside

We have selected three large-cap growth funds that are poised to gain from the above factors. Moreover, these funds have encouraging three and five-year returns. The minimum initial investment is within $5000.

We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors in identifying potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance but also on the likely future success of the fund.

The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).

T. Rowe Price Lrg Cp Gr I fund seeks to provide long-term capital appreciation through investments in common stocks of growth companies. TRLGX normally invests at least 80% of its net assets in the common stocks of large companies.

T. Rowe Price Lrg Cp Gr I fund has a track of positive total returns for over 10 years. Specifically, TRLGX’s returns over the three and five-year benchmarks are 20.1% and 15.2%, respectively. The annual expense ratio of 0.56% is lower than the category average of 0.55%. TRLGX has a Zacks Mutual Fund Rank #1.

To see how this fund performed compared to its category, and other #1 or 2 Ranked Mutual Funds, please click here.

T. Rowe Price Blue Chip Growth fund seeks long-term capital growth. TRBCX invests at least 80% of its net assets in common stocks of large and medium-sized, blue-chip companies that have the potential for above-average growth in earnings and are well-established in their respective industries.

T. Rowe Price Blue Chip Growth fund has a track record of positive total returns for over 10 years. Specifically, TRBCX’s returns over the three and five-year benchmarks are 13.4% and 14.2%, respectively. The fund has an annualexpense ratio of 0.69%, which is lower than its category average. TRBCX has a Zacks Mutual Fund Rank #1.

To see how this fund performed compared to its category, and other #1 or 2 Ranked Mutual Funds, please click here.

Fidelity Contrafund seeks capital appreciation. FCNTX invests primarily in the common stock of companies whose value management believes is not fully recognized by the public.

Fidelity Contrafund has a track of positive total returns for over 10 years. Specifically, FCNTX’s returns over the three and five-year benchmarks are 21.8% and 17.4%, respectively. FCNTX has an annual expense ratio of 0.64%, which is lower than its category average.

To see how this fund performed compared to its category and other #1 or 2 Ranked Mutual Funds, please click here.

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