From WSJ surveys:
Category Archives: financial markets
Public Service Announcement: Real Rates Are (Still) Low
If demand is so high, why are real rates so low (even admitting Fed QE, forward guidance, etc.)?
How Much of US Federal Debt Is Held by Foreign/International Investors
As a share of debt held by the public (i.e., excluding intragovernmental holdings).
Real Borrowing Costs for the US Treasury: May 2021
As of May 2021, the nominal 10 year Treasury rate is 1.6%. The real rate is -0.9%.
The Employment Surprise and Bond Yields
Given the employment surprise (NFP 266K actual vs. 978K expected, while GS forecasted 1300K), it would be remarkable if interest rates did not respond. Stock indices did drop, then recovered to pre-surprise trend. Five year bond yields did drop somewhat.
Inflation Expectations, Post-Passage of the American Rescue Plan
At the end of the week, the five year constant maturity Treasury yield continued to rise along with the implied expected inflation rate; but after accounting for the estimated term premium and liquidity premium (h/t Bob), the increase in the latter since the Georgia elections is much more modest.
Are Market Expectations of Inflation Really Rising?
A typical market-based measure of expected inflation is the inflation breakeven calculated by subtracting the TIPS yield from Treasury yield at corresponding maturities. The breakeven spread is shown as the blue line in Figure 1.
Interest Rate Projections
The CBO recently released long term projections for Federal budget variables, including debt. These projections rely upon the assumed path of interest rates. Here, there is considerable uncertainty. Figure 1 presents the 10 year Treasury yield, and CBO projections at various dates.
Guest Contribution: “Central Bank Digital Currency: Some Macro-Financial Implications”
Today we are pleased to present a guest contribution written by Hongyi Chen, Senior Advisor at the Hong Kong Institute for Monetary and Financial Research, and Pierre Siklos, Professor of Economics at Wilfrid Laurier University. The views expressed here are their own and do not reflect the official opinions of Hong Kong Institute for Monetary and Financial Research or any other institutions the authors are affiliated with.
“The” Stock Market
If one wanted to assess price trends in “the” US stock market, which measure would one want to use?