Inflation Fears Are Creeping Back π The Chart Report
Chart of the Day
π Today's Chart of the Day was shared by J.C. Parets.
Inflation-protected U.S. Treasuries are making new multi-year highs relative to nominal treasuries, signaling that the bond market is starting to price in higher inflation.
At the same time, the Bloomberg Commodity Index is pressing into new all-time highs, and pointing to a potential rebound in inflation as its historically tight relationship has diverged in recent years.
If inflation begins to re-accelerate similar to 2021, we could see a meaningful rotation of capital into more areas that are less sensitive to interest rates.
The Takeaway: Following todayβs hotter than expected inflation data, we can look to both the bond market and commodities for clues on where inflation may be headed next.
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