Wells Fargo sr strategist Boris....>

US TSYS/RESEARCH: Wells Fargo sr strategist Boris Rjavinski asks, "Will short

TIPS get carried away?" on storm fallout, said "front-end TIPS might get a boost

if gasoline price increases are sustained." He adds the "gasoline price jump

defies seasonal patterns. Our thoughts are with all those affected by Hurricane

Harvey, and we wish for everyone's safety and a speedy return to normal lives.

Rate mkts are not immune to events like Harvey, and so investors need to account

for the effects of a natural disaster to safeguard their portfolios."

- He said "sharp increases in gas prices since mid-August related to the giant

disruptions caused to the domestic refining operations" by the storm "have

raised questions about the near-term effect on inflation and the performance of

TIPS. Indeed, the roughly 9% spike in the price at the pump since 7/31 is not

only quite sizable by itself, but also runs counter to the typical seasonal

pattern of declining gas prices during the Sept-Dec period." He adds the "effect

of a near-term spike in fuel prices could be particularly pronounced for

short-duration TIPS"; he said analysis shows "front-end TIPS carry may indeed

get a significant boost in the near term."