American inflation expectations remain remarkably well anchored given the price shock of the past two and a half years. Our preferred measure of inflation expectations—the Federal Reserve’s five-year forward, five-year breakeven rate and the five-year forward breakeven index—imply that professional ... READ MORE >
five-year forward inflation expectation rate
Inflation expectations: Have they reached a peak?
One major theme this year, as the American and global economies reopen, is the risk of rising prices. The yield on the 10-year Treasury increased from 0.91% at the start of the year to a high of 1.74% on March 31. But over the past month, that yield has moved back down and is likely to return toward 1.45% ... READ MORE >
Powell statement: Market challenging Fed’s credibility on inflation targeting
The knee-jerk market response that sent the 10-year Treasury yield to 1.54% during Thursday’s speech by Federal Reserve Chairman Jerome Powell implies that the Fed may have to act to dampen yields at the long end of the curve. That may be necessary to reinforce its policy regime of flexible average ... READ MORE >