US 10y Real Rate pierces into positive territory - highest since Mar'20
▪️ partially achieves Fed's desire to tighten Financial Conditions
▪️ coincides with easing off in Inflation Expectations (Breakevens BE) + spike in Nominal rates (Real = Nominal - BE); 10y UST now @ 3.0%
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▪️ partially achieves Fed's desire to tighten Financial Conditions
▪️ coincides with easing off in Inflation Expectations (Breakevens BE) + spike in Nominal rates (Real = Nominal - BE); 10y UST now @ 3.0%
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▪️ Easing of Inflation Breakevens reflects tapering of growth exp (US Eco Data Surprise Index ⬇️) + narrative that Fed is now in control (of inflation)
▪️ Ease off in Inflation Expectations has not kept pace with S&P/Equity's ~14% drawdown since early Jan'22 (4796 high)
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▪️ Ease off in Inflation Expectations has not kept pace with S&P/Equity's ~14% drawdown since early Jan'22 (4796 high)
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▪️ Inflation Breakevens (TIPS implied) off their 25 Mar peak after spiking into Russian/Ukraine war; flatter curve
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