Sizeable Move in Break-Evens Puts 5y B/E Rate Close to Record High

• The inflationary outlook remains a focus for markets, with 10y break-evens continuing their march higher to touch new multi-year highs at 2.5857, highest since 2013. The 5-yr B/E rate topped the 2008 high on the way higher to 2.78. The series high 5-yr B/E rate was 2.9051 in 2005.

A few drivers/catalysts behind today's move:

• More Fed members doubling-down on stimulus plans (Fed's Evans: Fed has room to overshoot, will be a while before US has made enough progress to talk taper)
• Disappointing jobs gains on Friday further delaying any need to talk imminent withdrawal of stimulus
• NY Fed survey sees consumer inflation expectations at highest since Sept'13, with housing, rental expectations at new series highs.
• Sell-side eyeing upside risks to this week's CPI, PPI releases, with re-opening components to inflation baskets at risk of supply bottlenecks, driving up prices.