Barclays Says Buy Inflation Protection to Prepare for Trump Win
- Strategists recommend going long five-year TIPS breakevens
- Trump policies are ‘more likely to be inflationary,’ they say
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To interest-rate strategists at Barclays Plc watching the presidential debate Thursday night, the trade was clear: buy inflation hedges in the US Treasury market.
With former president Donald Trump appearing more likely to unseat Joe Biden in the Nov. 5 election, the market should “be pricing in a considerable risk of higher-than-target inflation in the coming years, and this is from a starting point of our thinking they already offered structural value,” Barclays strategists Michael Pond and Jonathan Hill said in a note.