Comparable maturity straight Treasurys outperformed Treasury Inflation-Protected Securities ((TIPS)) in the 2019 second quarter, but only slightly. On average, Treasurys earned a return of 3.2% in the quarter, better than the 3.0% return on TIPS.
On a price basis (excluding the inflation adjustment), Treasurys significantly outperformed TIPS. The average TIPS yield rose 5 basis points (bp) in the quarter to 0.45%, while average Treasury yields fell 44 bp to 2.01%. Most of the shortfall in price return on TIPS was therefore made up by the CPI inflation adjustment, which averaged 152 bp in the quarter.