Author Archives: Tipswatch

Summary The Treasury will reopen CUSIP 912810SM1 in a Thursday auction, creating a 29-year, 6-month TIPS. The real yield looks likely to be around -0.26%, making this the first TIPS of this term to get a negative real yield. Investors … Continue reading →

Summary In a surprise, July inflation came in much higher than the consensus for both all-items and core inflation. Gas prices again were a big factor. The recent surge in inflation now has the Social Security COLA on track for … Continue reading →

Summary The overall TIPS market has had a huge run-up of almost 16% since the bond market turmoil of mid-March. The TIP ETF hit a record high of $126.51 last week, but its one-year performance has been in line with … Continue reading →

Summary There have been 104 auctions of this 9- to 10-year term since 1997 and today’s result was a record low yield, by a large margin. The inflation breakeven rate came in at 1.52%, a reasonable number but higher than … Continue reading →

Summary The real yield for CUSIP 912828ZZ6 could end up around -0.82%, the lowest in the 23-year history of TIPS auctions of this term. Fears of future inflation – spurred by massive monetary and fiscal stimulus programs – should attract … Continue reading →

Summary Both all-items inflation and core inflation rose faster in June than the consensus estimates. Will any of this alter the Federal Reserve’s commitment to ultra-low interest rates? No. The June inflation report offers a glimmer of hope for a … Continue reading →

Summary The Social Security Administration uses an esoteric inflation index and only three months of data to determine the COLA. As of the May inflation report, the COLA would be set to zero. But May’s number is pretty much irrelevant … Continue reading →

Summary Demand looked strong at this auction, with the real yield falling about 7 basis points from the secondary market’s yield earlier in the morning. The inflation breakeven rate came in at 1.10%, a reasonable number given our uncertain deflationary … Continue reading →

Summary The real yield looks likely to drop to about -0.65%, the lowest yield for any auction of this term since April 2013. The inflation breakeven rate is running at about 0.98%, up from recent lows but still attractive as … Continue reading →

Summary Price declines reflected the effects of COVID-19 shutdowns, with gas prices falling, along with prices of auto insurance, air travel, apparel and lodging away from home. Price increases hit more necessary items: Food, shelter, medical care and, alcohol. How … Continue reading →