2024-03-05 10:24:44 ET
Summary
- Inflation expectations have risen over recent months, particularly at the 2-year horizon, and are set to intensify as the Fed sides with reducing debt servicing costs over fighting inflation.
- The Fed may be forced to restart Quantitative Easing to prevent Treasury yields from rising, leading to a rise in inflation and a move lower in real yields.
- The iShares TIPS Bond ETF offers a real yield of 2% and the potential for 13% capital gains as real yields decrease back to zero.
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For further details see:
TIP: Breakevens Back On The Rise As Fed Set To Give Up The Inflation Fight