- Real yields are near Treasury-estimate lows for 2019, but have popped slightly higher in recent weeks.
- Today’s auction yield of 0.174% meant that investors had to pay a premium to get a 0.250% after-inflation coupon rate.
- The inflation breakeven rate came in at 1.60%, a three-year low. A number this low had to spur interest from big-money investors.
I’d suggest steering away from five-year TIPS yielding lower than 0.40% and 10-year TIPS below 0.65%. It may be a while before we see yields that high again.