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As Rally Rolls, Keep an Eye on Inflation Expectations
For clues on inflation expectations in this carry-trade-crazed market, Tuesday’s auction of some $25 billion in 10-year treasury notes is something to pay attention to.
Submitted by
InflationCase
11/9/2009
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InflationCase
11/9/2009
InflationCase is playing it
Long1.08%
Long3.47%
I am playing this headline with (TIP TIPZ) because And there’s already some signs that worries about inflation are floating around out there. For one thing 10-year breakevens — that gap between the yield on 10-year Treasury Inflation Protected Securities (TIPS) and the yield on plain-vanilla 10-years — have been inching higher, a somewhat inflationary sign, although we’d need more evidence to confirm that inflation expectations are starting to break out.
 
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