- The CPI release last week was hot, but apparently it could be explained as "transitory," which caused the Treasury market to rally and yields to fall.
- CPI rose last month at an annualized 7.2% rate, and it is likely headed higher. Needless to say, if I expect inflation to rise further on the reopening of the economy, I wouldn't expect Treasury yields to fall in a meaningful way.
- I think we will most likely see Treasury rates above 2% by the end of the second quarter, notwithstanding the decline last week.
For further details see:
Not Worried About Inflation... Until Next Month