Category Archives: Investing in TIPS

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 →

Summary In its five-month auction history, CUSIP 912828Z37 showed remarkable volatility, with a swing of 115 basis points from March to May. Today’s real yield of -0.47% was the lowest at auction for any 9- to 10-year TIPS since March … Continue reading →

Summary The Treasury will reopen a 10-year TIPS at auction on Thursday, with the real yield to maturity expected to be well below zero. This TIPS — CUSIP 912828Z37 — had an amazing reopening auction in March, just as Treasury … Continue reading →

Summary The 20-year bond will re-launch Wednesday for the first time since 1986 at a regularly scheduled auction. The nominal yield should be about 1.05%. The Treasury will raise $20 billion in this auction, part of a massive borrowing effort … Continue reading →

Summary Gasoline prices fell a remarkable 20.6% in April, setting off a deflationary surge across the economy. Core inflation fell to 1.4% year over year, breaking a 27-month streak of rates at or above 2.0%. Inflation-protected investments, especially TIPS, will … Continue reading →

Summary U.S. Series I Savings Bonds purchased from May to October will pay a composite rate of 1.06%, annualized, for six months. EE Bonds will continue to double in value if held for 20 years, creating a tax-deferred, compounded rate … Continue reading →

Summary The new Treasury reality is negative real returns and stunningly low inflation expectations. The auction result of a real yield to maturity of -0.320% matched the Treasury’s overnight estimate. The inflation breakeven rate of 0.69% makes this TIPS – … Continue reading →