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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.
US
- It is interesting to see that while inflation has continued to surprise positively in the past few months in most of the DM/EM economies, long term bond yields have been falling due to the rising uncertainty.
- In this chart, we scatter plot the US 10Y yield and core CPI using monthly data since 1985.
- Previously, US 10Y yield was significantly higher when core CPI was standing at 4.5%; the trendline shows that the US 10Y yield should be trading at around 8%.
- However, we also know that a stagflationary environment (decelerating growth and accelerating inflation) has historically been negative for stocks.
- Therefore, investors' preference for 'safe' assets such as US Treasuries may remain elevated in the coming months, keeping long-term bond yields low despite rising inflationary pressures.
Source: Bloomberg/MNI
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.
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