The Most Important Number of the Week Is 1.30%
The gains in the inflation numbers are less menacing when viewed in a broader context.
Used-car prices are a chief contributor to rising inflation numbers.
Photographer: Bess Adler/Bloomberg
Mystery solved? There’s no bigger question in financial markets than why U.S. government bonds — the benchmark for all markets worldwide and the ultimate “risk free” asset — have managed to rally in the face of faster inflation and a booming economy.
At 1.30%, the yield on the 10-year Treasury note is down from the high this year of 1.77% at the end of March and about half a percent less than where economists surveyed by Bloomberg last month expected it to be this quarter. For those keeping score, yields have now dropped three consecutive weeks and eight out of the past nine.