Treasury Market Shows Renewal of Inflation-Uptick Concern
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The Treasury market is starting to show renewed inflation expectations, giving the Federal Reserve more latitude to raise interest rates while most of the world’s other major central banks add to monetary stimulus.
The debt markets’ outlook for the pace of inflation during next five years has risen on more than half of the trading days this year. The yield on 10-year Treasury Inflation-Protected Securities, known as TIPS, auctioned yesterday at 0.315 percent, below the 0.346 percent forecast in a Bloomberg News survey, and reached as low as 0.11 percent Friday in New York, as investors sought protection against price increases.