The recent drop in both Treasury yields and TIPS yields are adding credence to the success of the Federal Reserve’s campaign to squeeze inflation out of the economy. … READ MORE >
Treasury bonds
The impact of expectations for Fed policy on the money and bond markets
Prices in the money market now suggest increased levels of risk being priced into short-term lending and the tightening of overall financial conditions that was missing until the recent banking turmoil. … READ MORE >
Negative-yielding debt back above $15 trillion globally as risk of delta variant rises
Over the past 90 days, rising economic and social risks linked to the Delta variant around the world have rattled investors and pushed them back into the safety of government-issued debt. … READ MORE >
CHART OF THE DAY: Deflating the hype on inflation
While we do expect the year-ago effects brought on by the global pandemic to result in a period of moderate reflation in the economy, the longer-term outlook implies that elevated inflation will be transitory and give way to price stability. … READ MORE >
CHART OF THE DAY: The 10-year Treasury yield goes its own way
Fixed-income investors are clearly pricing in a general reflation of the economy this year that will produce growth rates not observed since the late 1990’s. … READ MORE >
CHART OF THE DAY: The bond market’s assessment of governance and economic risk
The yield on 10-year Treasury bonds continues to move above 1%, reaching 1.15% last week for the first time since the end of last February, when the severity of the coronavirus outbreak was becoming apparent. … READ MORE >
CHART OF THE DAY: Pandemic economics, in 14 charts
The bond market, and not the equity market, provides perhaps the best assessment of the future of the economy. And these days, no matter how you parse the data, the bond market is telling a clear story: The corporate sector and the broader economy remain at risk. … READ MORE >
Assessing the bond market ahead of the coming change to Fed policy
The bond market is signaling that investors are preparing for an average inflation targeting regime, a quicker and more brisk pace of asset purchases or perhaps a yield curve cap out to the three-year maturity spectrum … READ MORE >
Will yields rise due to increased issuance of Treasury bonds? Let’s get the elephant out of the room!
Apprehension expressed by economic and financial pundits about potential runaway inflation and higher interest rates in the wake of the U.S. Treasury’s recent issuance of bonds is high. Our assessment of both the economic and policy paths strongly implies hat these worries will not become actualized in the near term. … READ MORE >