TIPS Derived Expected Inflation

By Jun 22, 2009, 12:09 PM Author's Blog  

TIPS Derived Expected Inflation

The chart above shows the weekly, bond market-based 10-year TIPS-derived expected inflation, calculated as the difference between 10-year regular, nominal Treasury yields and 10-year Treasury inflation-indexed yields (St. Louis Fed data here). After a unusual period in late 2008 resulting in a negative spread when the TIPS 10-year yields were above 4%, and higher than regular Treasury yields of about 2%, the Treasury market seems to have stabilized, and the bond market’s 10-year expectation of inflation is back around 2.5%, consistent with the inflationary expectations from 2004-2007.

  • SHARE:
  • Share on StockTwits

LEAVE A COMMENT

SPY204.97  chart0.00  chart +0.00%
GOOG539.95  chart0.00  chart +0.00%
AAPL112.98  chart0.00  chart +0.00%
TSLA201.29  chart0.00  chart +0.00%
BBRY10.705  chart0.00  chart +0.00%
NFLX437.455  chart0.00  chart +0.00%
FB77.83  chart0.00  chart +0.00%

Nikkei17468.52  chart-43.23  chart -0.25%
Shanghai3383.182  chart+31.418  chart +0.00%
UK6826.92  chart-5.91  chart -0.09%
France4662.03  chart+21.34  chart +0.46%
Germany10751.96  chart+102.38  chart +0.96%