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Real Yields Stand Ground As Breakevens Dip

US
  • The intraday rally in longer end Tsys has come from inflation breakevens shifting lower, with the 10Y nominal yield almost unchanged on the day as the breakeven falls 3bps to 2.52%.
  • The move started prior to US data and received further support from weak Conference Board consumer sentiment and another miss for a regional Fed manufacturing survey.
  • Real yields meanwhile have been largely unmoved through the rally, sitting 3bps higher on the day at 68bps. Excluding the fervour just before and after the FOMC decision two weeks ago, these are the highest real yields since Mar-2019.

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