10-Year TIPS Reopening Auctions With A Real Yield Of 0.512%

Summary

  • The after-inflation yield was the highest at auction for this term since January 2016, breaking a string of 10 auctions under 0.50%.
  • The inflation breakeven rate came in at 1.84%, a reasonable number but well off the lows of early summer.
  • Market reaction to the auction has been muted, with the TIP ETF barely budging after the 1 p.m. auction close.

Read my full analysis on SeekingAlpha.com.

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U.S. Inflation Rose 0.1% In October, Hitting Expected Number

Summary

  • Both the headline and core inflation numbers matched the consensus estimates, so no surprises in today’s numbers.
  • Non-seasonally adjusted inflation declined slightly in October, which will cause a slight drop in TIPS principal balances in December.
  • A December rate increase still looks likely from the Federal Reserve.

Read my full analysis on SeekingAlpha.com

Also, I have updated my Inflation and I Bonds page with these new numbers.

And here are the new December inflation indexes for all TIPS.

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10-Year TIPS Will Reopen At Auction Thursday; Is It Worth A Look?

Summary

  • The real yield could rise above 0.50% for the first time since January 2016. If that trend holds, should you consider an investment?
  • The inflation breakeven rate is currently 1.89%, which is reasonable but puts this TIPS in the neutral zone versus a nominal Treasury.
  • How strong will the demand be at Thursday’s auction? Watch the yield trends this week before investing.

Read my full analysis on SeekingAlpha.com

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Does The Social Security COLA Shortchange Seniors?

Summary

  • The COLA formula is based on an index that slightly lags overall inflation.
  • The COLA formula uses an ‘averaging’ formula that lessens the impact of short-term spikes in inflation.
  • The COLA formula falls well below the inflation-adjusted returns of U.S. Series I Savings Bonds.

Ready to delve into a big pile of numbers? Read my full analysis on SeekingAlpha.com.

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Treasury Raises I Bond Fixed Rate To 0.1%, Sets Composite Rate At 2.58%

Summary

  • Investors waiting to complete their I Bond allocation for 2017 have the green light: Buy in November.
  • A fixed rate of 0.1% means these I Bonds should be held longer than I Bonds with a fixed rate of 0.0%.
  • Terms on EE Bonds remained the same: A fixed rate of 0.1%, but a doubling in value if held for 20 years.

Read my full analysis on SeekingAlpha.com

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I Bond Investors: Yes, It’s Possible The Fixed Rate Will Rise

Summary

  • How does the Treasury determine the I Bond fixed rate? It’s a mystery.
  • A recent surge in 5-year real yields seems to justify an increase in the fixed rate, and 10-year real yields are also rising.
  • Most I Bond investors are waiting until November 1 to complete their I Bond allocation for 2017. What are the odds of a higher fixed rate?

Read my full analysis on SeekingAlpha.com

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30-Year TIPS Reopening Auctions With A Real Yield Of 0.908%

Summary

  • The after-inflation yield came in right on target, based on pre-auction trading in this TIPS on the secondary market.
  • The inflation breakeven rate was a moderate 1.92%. This TIPS seems fairly priced versus a nominal 30-year Treasury.
  • Long-term real yields haven’t risen in 2017, even as short-term yields are up about 25 basis points.

Read my full analysis on SeekingAlpha.com

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