Category Archives: Investing in TIPS

Summary The term is too long. The risk is too high. The potential reward is too low. An inflation breakeven rate of about 1.72% will make this TIPS appealing for big-money investors, so this auction should get solid demand. But … Continue reading →

Summary Year-over-year U.S. inflation hit 2.5% in January, the highest number since October 2018. Gas prices declined, but core inflation held at 2.3%, indicating that inflationary trends are widespread in the economy. Non-seasonally adjusted inflation rose 0.39% in January, balancing … Continue reading →

Summary Investors had to pay a big premium for this TIPS, about $100.86 for $99.97 of value, after the January inflation adjustment. The inflation breakeven rate came in at 1.68%, slightly lower than looked likely last week. Still, inflation fears … Continue reading →

Summary The Treasury will offer a new 10-year TIPS at auction Thursday. Real yields are currently running at about 0.09%. TIPS have had a great run over the last year, but wasn’t the time to buy a year ago? The … Continue reading →

Summary Gasoline prices, up 7.9% in 2019, and shelter costs, up 3.2%, were major factors in 2019’s moderately high inflation. December inflation, however, fell slightly below consensus estimates. You can expect the Fed to continue its “on hold” rate policy. … Continue reading →

Summary The I-Bond’s current fixed rate of 0.20% (essentially, its “real yield”) means it remains the most attractive inflation-protected investment. I recommend waiting until April 10 to make an I-Bond investment decision, because we will then know the future variable … Continue reading →

Summary 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 … Continue reading →