Treasury Raises I Bond Fixed Rate To 0.30%, Highest Since 2009

Posted on May 1, 2018 by Tipswatch

Summary

  • I Bonds purchased from May 1 to October 31 will carry a composite rate of 2.52% annualized.
  • Real yields have been rising, which supports the Treasury’s decision to increase the fixed rate to 0.30%, the highest rate reset since November 2009.
  • A new I Bond buying strategy? In my opinion, the fixed rate of 0.30% is too attractive to pass up.

Read my full analysis on SeekingAlpha.com

Posted in Investing in TIPS | Leave a comment

5-Year TIPS Auctions With A Real Yield Of 0.631%, Highest In Nearly 9 Years

Posted on April 19, 2018 by Tipswatch
  • The after-inflation yield was the highest for any 4- to 5-year TIPS auction since October 2009.
  • The coupon rate was set at 0.625%, the first time any TIPS of this term has had a coupon rate higher than 0.125% since April 2010.
  • The inflation breakeven rate came in a 2.13%, higher than in recent auctions but still in a ‘neutral’ range.

Read my full analysis on SeekingAlpha.com

Posted in Investing in TIPS | Leave a comment

Thursday’s 5-Year TIPS Auction May Be The Most Attractive In Years

Posted on April 15, 2018 by Tipswatch

Summary

  • Current trends are pointing at a real yield above 0.65%, the highest for any 4- to 5-year TIPS auction since October 2009.
  • This TIPS will outperform a U.S. Series I Bond over five years and is very competitive with best-in-the-nation bank CDs.
  • The inflation breakeven rate should come in slightly higher than 2.0%, putting this TIPS in the “neutral” range versus on nominal Treasury.

Read my full analysis at SeekingAlpha.com

Posted in Investing in TIPS | Leave a comment

I Bond Investors: Hold Off On Purchases Despite A Declining Variable Rate

Posted on April 12, 2018 by Tipswatch

Summary

  • The I Bond’s six-month variable rate will fall from 2.48% to 2.22% on May 1. The difference in yields is temporary and negligible.
  • The fixed rate will also be reset May 1, and odds are that it will hold at 0.1% — or rise to 0.2%, possibly even 0.3%.
  • The potential for a higher fixed rate means investors should delay purchases at least until after May 1, maybe even later.

Read my full analysis on SeekingAlpha.com

Posted in Investing in TIPS | Leave a comment

I Bond’s Variable Rate Will Fall To 2.22% On May 1

Posted on April 11, 2018 by Tipswatch

Summary

  • Non-seasonally adjusted inflation from September 2017 to March 2018 rose 1.11%, which creates the new annualized rate.
  • Seasonally adjusted inflation in March actually dropped 0.1%, which was below expectations. Core inflation came in at 0.2%.
  • Both ‘headline’ and core inflation are at one-year highs.

The variable rate on U.S. Series I Savings Bonds will fall from 2.48% to 2.22% for I Bonds purchased after May 1, based on the March inflation numbers just released by the U.S. Bureau of Labor Statistics.

Read my full analysis on SeekingAlpha.com

Posted in Investing in TIPS | Leave a comment