Monthly Archives: January 2017

Thank You, Janet Yellen: New 10-Year TIPS Auctions With A Real Yield Of 0.436%

Summary TIPS yields rose Wednesday after Fed Chair Yellen signaled more interest rate increases are coming. Investors at today’s auction got a boost in yield, the highest in a year. The 10-year inflation breakeven rate hit 2.044%, signaling that TIPS … Continue reading

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U.S. Inflation Rose 0.3% In December; Up 2.1% Over Last 12 Months

Summary News is not good for I Bond investors: Inflation is flat over first three months of rate-setting period. Year-over-year ‘headline’ inflation broke through the 2.0% barrier for the first time since June 2014. Core inflation rose 2.2% in 2016, … Continue reading

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Coming January 19: Treasury Will Auction A New 10-Year TIPS, One Worth Watching

Summary A week away, the yield to maturity is estimated at 0.39%, not awful but also not really attractive. The inflation breakeven rate of 1.99% indicates TIPS are no longer ‘cheap’ versus nominal Treasurys. Looking ahead: 5 more auctions of … Continue reading

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I Bond Investors: Here’s Your Buying Guide For 2017

Summary Advice: Do nothing for three months. The current 2.76% variable rate is at risk, but the current fixed rate of 0.0% is too low. It’s a waiting game: Watch the variable rate trend and hope for a higher fixed … Continue reading

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Recapping 2016: The Year In Treasury Inflation-Protected Securities

Summary TIPS yields started and ended the year at relatively high levels, but dipped at midyear. TIPS outperformed the overall bond market as inflation expectations rose, increasing demand for TIPS and softening increases in yield. Are today’s higher yields a … Continue reading

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