Real yields have moved higher, surging, actually, to start this year (up until more recently, that is). The 5-year TIPS rate has gone from ungodly ugly mid-November, sunk down to -191 bps, to a still-awful but much less so -130 bps as of today. That’s a 61 bps move in less than two months, thirty of those coming since the [...]
For the first time since last December, the level of Job Openings (JO) pictured by the BLS’s JOLTS survey declined. End of the line for the economy?I am intentionally overselling this monthly minus. While the latest figure for September 2021 was indeed less than the one for August, if only because August’s estimate was raised by several hundred thousand. Going [...]
We already covered the yield curve’s reaction given today’s whopping consumer price levels. How about strictly inflation expectations in the market? TIPS, breakevens and such.Unsurprisingly, shorter-term breakevens (5s) jumped 12 bps to a new high of 308 bps (boosted considerably following the auction on October 21st). Pulling up the rest of the inflation “curve”, the 10-year breakeven added a “mere” [...]
Searching for clues or even small collateral indications, you can’t leave out the gold market. We’ve been on the lookout for scarcity primarily via the T-bill market, and that’s a good place to start, yet looking back to last March the relationship between bills and bullion was uniquely strong. It’s therefore a persuasive pattern if or when it turns up [...]
The way it has been described since, yesterday’s CPI estimates for last month represented a seismic shift in the inflation debate. There is no more argument, apparently, and if that wasn’t apparent enough then today it was followed up with even more highly-touted evidence. Producer prices, the PPI, came up even more over-the-moon than those for consumers.The commodities portion, no [...]
Reopening 2 is definitely happening. The labor market, in particular, is sending off the same kind of signals if not to the same huge extent as it had during Reopening 1 in May and June of last year. The March 2021 payroll report was better than 900,000, and the one for April (last month) to be released tomorrow is expected [...]
The sound of economic sizzle finally within earshot, though perhaps nearly a year too late. PMI’s for the month of March 2021 were of the sort which should have come about in May and June 2020. The “V”-shaped recovery was much talked about at that earlier time, though in PMI terms (as well as regular “hard” data) the numbers fell [...]
There is precedence for this, though not to this extent; it has reached a record. And when it happened before, oil prices were right in the middle of it, too. The 5-year TIPS breakeven rate has surged to equal its highest in a very long time. Considered by many evidence for an inflationary breakout – these are inflation breakevens, after [...]
According to the Federal Reserve’s preferred inflation measure, the PCE Deflator, consumer price pressures remained muted in January 2021. No surprise, given the absence of inflationary conditions contained within the prior released CPI report for the same month, as even the contribution from surging oil prices was noticeably minimal in both. The Bureau of Economic Analysis (BEA) today said that [...]
Tomorrow represents the 6-month mark for the Treasury market. On August 4, 2020, nominal benchmark 10-year yields declined to their absolute closing lows. Over the half-year since, rates have generally been on the rise which should be a long enough period by which to categorize our interpretations of what it all means.Most mainstream commentary places any upward trend (of any [...]
Stay In Touch