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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.
FED
Fed Gov Brainard noted in a post-speech Q&A today that she saw longer-run US inflation expectations as "extremely well anchored" (as quoted by wires).
- This is arguably a subtle step up in language from Brainard's comments earlier this month where she described expectations as "very well anchored". That quote came on May 11, before the record-breaking April inflation print - 5Y5Y forward inflation closed at 2.54%, vs 2.41% at the time of today's speech.
- And yet, that change in tone is arguably justified. We note that the latter figure is 24bps below 5Y TIPS-implied breakevens, suggesting even better anchored expectations vs May 11 (when it was 16bps below) - this is the metric St Louis Fed Pres Bullard cited in an interview with MNI last week.
- While it may be reading too much into it, Brainard's comments further suggest that the Fed is keeping a watchful eye on market-based long run inflation expectations. And they do appear to have become slightly better anchored in the past couple of weeks.
Source: BBG
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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