- This was the lowest real yield for a 4- to 5-year TIPS auction since April 2017, when a new TIPS got a real yield of -0.049%.
- The inflation breakeven rate was 1.69%, a reasonable number that was higher than the originating auction’s 1.50%. Inflation expectations are rising.
- As the 5-year TIPS real yield dips perilously close to negative, investors seeking safety should look for better alternatives: I Bonds or insured bank CDs.
The U.S. Treasury announced Thursday that its $15 billion reopening auction of a 5-year TIPS, CUSIP 912828YL8, generated a real yield to maturity of 0.020%, the lowest for this auction term since April 2017.
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Yes, the purchase limit is not affected by an I Bond redemption. It remains $10,000 per person per year.