Category Archives: Investing in TIPS

Summary Five-year real yields have dropped nearly 100 basis points in the last six months. That’s a huge move in anticipation of Federal Reserve rate cuts. Today’s real yield of 0.152% had to be a disappointment to investors, who also … Continue reading →

Summary Expect volatility in the Treasury market this week because the Federal Reserve’s Open Market Committee will issue a statement Wednesday, one day before the auction. At this point, CUSIP 128286N5 is heading toward a real yield of about 0.35%, … Continue reading →

Summary The Federal Reserve looks likely to begin cutting short-term rates in 2019, possibly as much as 75 basis points over the next year. Yields for money market funds and short-term Treasurys will track lower with those rate cuts. Inflation-protected … Continue reading →

Summary Both headline and core inflation numbers fell short of consensus estimates. Gasoline prices fell 0.5% in May, following a 5.7% increase in April. Gas prices could be a deflationary force in coming months. May’s mild inflation report leaves the … Continue reading →

Summary FRNs, 2-year Treasury investments, have been in the news recently because their yields topped all Treasury investments with terms up to 10 years. FRNs are attractive during a time of rising interest rates, especially for cash you know you … Continue reading →

Summary The real yield of 0.567% was in line with where this TIPS was trading Thursday morning. No surprise, and the auction appears to have been met with strong demand. Buyers had to pay a lofty premium, however, because the … Continue reading →

Summary The real yield is likely to come in around 0.57%, well below the coupon rate of 0.875%. That means buyers could be paying a premium of nearly 3% to capture that coupon rate. Is that too high a price … Continue reading →