Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
U.S. real yields moderated a touch vs. pre-FOMC levels in the wake of the latest Fed decision, after Chair Powell pushed back against the idea of 75bp rate hikes. Still, the 10-Year real yield metric remained in positive territory after its first meaningful break above 0% in the current cycle, which took place earlier in the week. The market has shown signs of some faith in the Fed being able to tame inflation (although the transitory nature of inflation over along enough horizon debate is of course a factor there). 5- & 10-Year breakeven rates operate away from their cycle highs, but still remain elevated when compared to the Fed’s inflation target, sitting at ~3.25% & ~2.85%, respectively, late in the NY session. Meanwhile, 5-Year/5-Year inflation swaps sit at ~2.70%.
Fig. 1: U.S. 5-Year & 10-Year Real Yields & 5-Year/5-Year Inflation Swaps (%)
Source: MNI - Market News/Bloomberg
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.