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Latest iShares TIPS Bond News and Updates

Plosser on the use of Taylor-like rules in systematic guidance
In this part, we will discuss Dr. Plosser’s views on the use of systematic tools, for example, Taylor-like rules for setting policy rates and communicating these to markets.
4 must-know facts about rising inflation and your portfolio
Recent readings have shown that inflation has stabilized, which is a good thing, but signs of an imminent acceleration in inflation are still scant.

Your Update on the FOMC July Meeting
In its July meeting, the Federal Open Market Committee decided to maintain its target range for the federal funds rate at 1%–1.25%, in line with the market’s expectations.

What Does Inflation’s Retreat Mean for Gold?
Inflation hedge Investors tend to hold gold in their portfolios as insurance against inflation. When inflation is high, the value of paper currency, in terms of the goods and services it can buy, falls. As investors want something that doesn’t lose its value, gold usually has a direct relationship with inflation. Demand for gold increases as inflation […]

US Inflation Softens, Gold Still Has Drivers to the Upside
As per the U.S. Bureau of Labor Statistics, the US Consumer Price Index (or CPI) rose 0.2% in February, compared to a 0.5% rise in January 2018.

What worries Charles Evans?
A slowing global economy is also a worrying factor for Charles Evans. Companies with an export focus will hire fewer people if there are fewer orders.

How to Ballast Your Portfolio with Bonds
Municipal bonds (or munis) were the best performers in 2015 with returns of 3.2%. Meanwhile, investment-grade corporate bonds (LQD), long-dated Treasuries (TLT), and high-yield bonds (HYG) all gave negative returns in 2015.
Why you should invest in some of the 1,500 ETFs in the US
In this series, we’ll introduce you to the concept of exchange-traded funds (or ETFs). You’ll find out about the types of ETFs and how they can help your portfolio.

Is the US Economy Ready for Another Rate Hike?
With the US economy gearing itself up for the another rate hike, investors are investing in short-term Treasury securities whose price will fall less in value when interest rates rise.
Understanding the Fed’s yield curve can impact your bond returns
The yield curve is a graph that plots interest rates at different maturities with the same credit quality that can range from a month to 30 years or more.
Must-know fundamentals about the US Consumer Price Index
The Bureau of Labor Statistics (or BLS) developed the U.S. CPI in 1913 to measure the change in prices.

Why May’s Inflation Was Just Hot Enough
On June 12, the US Bureau of Labor Statistics reported that US consumer prices rose 0.2% in May, adding to the 0.2% increase seen in April.

Why Treasury Inflation-Protected Securities May Offer Some Value
TIPS may offer some value as inflation breakeven seems modest. TIPS provide investors a hedge against inflation just like gold (GLD) and other commodities (DBC).

Bridgewater: What Are Ray Dalio’s Top Investing Ideas?
Founded by Ray Dalio, Bridgewater Associates’ top sell in the third quarter was the iShares MSCI Emerging Markets ETF (EEM).
What the 30-year TIPS auction says about inflation expectations
Last week, the U.S. Treasury auctioned securities worth $95 billion. These included Treasury bills and Treasury Inflation Protected Securities (or TIPS). TIPS offer bond investors protection against rising inflation. Despite the low bid-cover ratio, market demand for the securities rose.

Why was the short-term T-Bills auction strong last week?
The short-term securities that have already been auctioned last week include four-week, 13-week, and 26-week T-Bills.
New Cleveland Fed CEO Loretta Mester weighs in on monetary policy
Loretta Mester is the new president and chief executive officer of the Federal Reserve Bank of Cleveland. She has taken over the reins from Sandra Pianalto, who retired on May 31.
Why the 5-year TIPS auction saw lower investor demand
The U.S. Treasury auctioned five-year TIPS worth $16 billion on August 21—lower than the $18 billion auctioned in April. Despite lower issuance, demand for the securities was lower at 2.48x—compared to 2.70x for the April auction.
Must-know: Inflation fighting investments
One of the strongest drivers of fair trade in gold (or IAU) is real interest rates.
An investor’s must-know guide to US Treasury auctions
The U.S. Treasury Department issues Treasury securities of varying maturities to finance government debt. The yield on these securities is determined through a public auction process

Gundlach: Invest in Industrials, Materials, Financial Sectors
“Industrials, materials, and financials are the sectors. . .you want to be invested in,” said Jeffrey Gundlach recently in a CNBC interview.

Why the demand in the high yield bond market rebounded last week
The high yield bond funds flow turned positive last week after a relatively small outflow the previous week, which broke the line of seven straight weeks of inflows.

Do Strong Growth and Weak Inflation Make a Case for a Lower Rate?
The US Bureau of Economic Analysis released its personal consumption expenditure (or PCE) price index today. The PCE index is the Federal Reserve’s preferred gauge of inflation.

JPMorgan Chase Expects Gold to Go Higher in 2019
JPMorgan Chase (JPM) thinks that gold prices (GLD) should go higher. Right now, the Fed is patient on rate hikes.

These Assets Could Be Attractive If Fed Rethinks Inflation Course
The Federal Reserve’s two main objectives are stabilizing prices and maximizing employment.

JPM Likes Gold, as Fed Might Let Inflation Overshoot Target
The Federal Reserve has two main objectives: price stability and maximizing employment.

Buffett versus Dalio on Gold: Whose Advice Should You Take?
When it comes to investing in stocks, Berkshire Hathway’s (BRK.A) chair, Warren Buffett, and Bridgewater’s founder, Ray Dalio, have similar advice.

Fed: Jobs Report Could Show Future Rate Hike Path
Fed policymakers are watching the job data closely. The data show whether the US economy is strong enough to withstand interest rate hikes.

Why the Fed Could Make Gold Shine Next Year
A major factor weighing on gold prices this year was the Fed’s tightening cycle.

Largest Ever One-Month Rotation into Bonds Signals Pessimism
Another concerning statistic that came to light during the Bank of America Merrill Lynch’s Fund Manager Survey was that investors made the largest ever one-month rotation into bonds (BND).

Are Stock Markets Celebrating a Weaker US Jobs Report?
The US jobs report for November was released today.

CPI Underwhelms Today: Will the Market Heave a Sigh of Relief?
The US consumer price index (or CPI) for September was released today at 8:30 AM EST. Inflation numbers were weaker-than-expected.

US Equities Down on Rising Rate Fears: Watch Out for CPI Next
Increasing interest rates spooked investors again today as US stocks dropped sharply amid rising Treasury yields.

What to Look for in the Fed’s September Meeting
The Fed is scheduled to meet on September 25–26. The Fed is widely expected to raise rates by 25 basis points during the meeting.

Oil Prices Soar on OPEC Agreement—What Does It Mean for Gold?
After its June 22 meeting, OPEC decided to increase its output. However, this increase was lower than what the markets expected.

FOMC: We Are Not Declaring a Victory on Inflation
The FOMC’s June statement was released on June 13, and the outlook for inflation remained upbeat.

Why Does the Fed Expect Unemployment to Fall Further?
The US Federal Reserve has a dual mandate of achieving maximum employment and stable prices (TIP) in the economy.

How Could High Inflation Affect the Fed?
During the Fed’s May meeting, the inflation (TIP) target was described as “symmetric,” suggesting that the 2% target would not be used to initiate any dramatic changes to US monetary policy.

Why This Week Could Define the Direction of Monetary Policy
The central banks of the US, EU, and Japan are scheduled to meet this week.

What Now as the US Fed Is Close to Meeting Its Targets?
As of June 1, the unemployment rate in the US has dropped to 3.8%—its lowest level in the last 18 years.

Which Sector Posted the Most Job Gains in May?
As per the May ADP employment report, job growth in the professional and business services sector continued to be the key driver for jobs additions.

What’s Supporting Gold Prices and What’s Not
On Thursday, silver was up 0.8% to $16.6 an ounce.

Key Takeaways from May’s FOMC Meeting Minutes
The most recent FOMC meeting was on May 1–2. At the meeting, the range for the federal funds target rate was left unchanged.

How the Fed’s Minutes Played on Precious Metals
On May 23, the Fed’s May meeting minutes gave some support to gold prices as the ten-year Treasury note (IEF) yield dropped almost 5.1 basis points to 3.0%.

Falling Weekly Claims Signal Overheating Job Market
The Conference Board uses average weekly unemployment claims as a constituent of its Leading Economic Index (or LEI).

Could the US Dollar Slump Be Short Lived?
The US dollar depreciated against its major trading-partner currencies after the Bureau of Labor Statistics reported on May 10 that US consumer prices grew 0.1% in April after falling 0.1% in March.

Bond Yields Fall after April Inflation Data Release
US bond market investors were relieved after the US Bureau of Labor Statistics’ April report, published May 10, indicated a lower-than-expected inflation growth rate.

How April’s Inflation Data Relieved Markets
On May 10, the Bureau of Labor Statistics reported that US consumer prices rose 0.2% in April.

Could there be a 4th Rate Hike in the Cards?
The Bureau of Economic Analysis defines PCE (personal consumption expenditure) as the value of goods and services purchased by, or on behalf of, US residents.

Which Sector Posted Major Job Gains in April?
The US employment market could be overheating. Businesses are adding more than 200,000 jobs per month despite rising trade tension.

Key Macro Events This Week
US markets (IJH) will be tracking ongoing corporate earnings. US markets could be influenced by the multiple economic reports scheduled this week.

Why Interest Rate Spreads Are Decreasing Again
In April, the yield spread has declined to the lowest level since the Great Recession and could decline further if inflation doesn’t accelerate.

US Job Openings Still Near Highs
The BLS released the “Job Openings and Labor Turnover Survey” for February on April 13.

Why March’s Inflation Numbers Could Pressure the Fed
The US Bureau of Labor Statistics has reported that US consumer prices fell 0.1% in March.

US Inflation Rises: How Will It Impact Gold Prices?
According to the US Bureau of Labor Statistics, the US consumer price index (or CPI) rose 2.4% year-over-year (or YoY) in March 2018.

FOMC on the Economic Situation: A Strong US Economy
In the March meeting minutes, the FOMC staff review of the economy was stronger than the review presented at the January meeting.

Key Takeaways from the March FOMC Meeting Minutes
The last FOMC (Federal Open Market Committee) meeting was on March 20–21, 2018. Overall, the FOMC minutes were “hawkish.”

Why the Fed Expects Unemployment to Fall to 3.6%
Over the last 12 months, unemployment levels have fallen to a 17-year low of 4.1%.

What’s the Fed’s View on Inflation Growth?
The FOMC’s March statement was released on Wednesday, March 21, and the outlook for the closely watched inflation remained muted.

Why Did the Fed Upgrade Its GDP Forecast for 2018?
In the latest SEP release, the Fed upgraded its GDP growth outlook for 2018 by 0.2% to 2.7%.

A Strengthening US Economy and a Cautious Fed
In the first policy meeting under new Fed chair Jerome Powell, the FOMC (Federal Open Market Committee) increased the interest rate 0.25%.

Why Equity Market Spike after Inflation Report Could Be Short-Lived
The most awaited economic data release of the week proved to be risk positive, as inflation growth for the month of February was reported at 1.8%.

Why Odds of 4th Rate Hike Fell after February Inflation Report
The US Bureau of Labor Statistics reported that US consumer prices increased marginally in February.

Why Economist Argue That Tariffs Are Bad for the Economy
The recently proposed import tariffs on steel and aluminum imports by US President Donald Trump are an effort to protect the interests of US manufacturers.

Could the Lower 4Q17 GDP Estimate be Reason to Worry?
The US Bureau of Economic Analysis (or BEA) has released its second 4Q17 GDP estimate, projecting that the US economy increased at an annual rate of 2.5%.

How Big a Problem Could US Debt Become?
If we turn back the clock to before the recession, we find that US debt levels weren’t this high, and unconventional programs like quantitative easing helped the economy recover from the Great Recession.

Why the US Economy Could See a Higher Deficit
A government budget deficit occurs when an economy’s annual revenue is less than its total expenditure.

Could Rising Inflation Boost Gold?
There has been much hype about the expected movement of inflation and how the Federal Reserve would react to this.

How Inflationary Pressure Played on Gold Last Week
Among the core indicators playing precious metal prices is the rise in US inflation, which is currently at 2.2%—almost at growth of 1% compared to the start of 2016.

FOMC’s Review of Economic Situation Signals Strong US Economy
As per the FOMC staff report, inflation (TIP) in the US remained below the 2% target.

Will the Bond Market Rebound along with Equity Markets?
US bond markets found some relief in the week ending February 16, as bond yields retreated from their multiyear high at the end of the week.

Why Quit Rate Indicates a Strong US Employment Market
As per the latest JOLTS report, total separations for December were 5.2 million, which is 3.6% of the total workforce.

Tug-of-War: How Inflation and Interest Rates Are Pulling Gold
The better the economic forecast for the US, the sooner we could see more interest rate hikes.

How Consumer Goods and Materials Orders Could Increase with Tariffs
The Conference Board LEI uses the level of new orders in the consumer goods and materials as an important constituent of the LEI.

Inflation’s Outlook Firms—How’s Gold’s Looking?
Rising oil prices The pace of inflation in the United States unexpectedly strengthened in December 2017 when the core consumer price index (or CPI) rose by 1.8% year-over-year (or YoY), including a monthly advance of 0.3%. The monthly gain was higher than economists’ expectation of a rise of 0.2%, according to Bloomberg. Inflation expectations (TIPS) have […]

Why Did the Consumer Price Index Rise in December?
According to the December CPI report released by the U.S. Bureau of Labor Statistics on January 12, consumer prices in December increased 0.1%.

Analyzing the Producer Price Index in December
The December PPI fell 0.1% month-over-month—compared to a 0.4% increase in November and October. The final demand index rose 2.6% in 2017.

How Many Americans Quit Their Jobs in November?
As per the latest JOLTS report, about 3.2 million American workers quit their jobs voluntarily in November.

What November Job Openings Say about US Economy
As per the January JOLTS report, there were 5.9 million job openings at the end of November.

Why Consumer Expectations Continued to Increase in November
Consumer expectations for business conditions Average consumer expectations for business conditions form the only component of the Conference Board LEI (Leading Economic Index) that is not a leading indicator. Consumer expectations are based on two separate surveys. One survey is conducted by the University of Michigan and Reuters, while the second survey is conducted by […]

Should We Worry about Rising Unemployment Claims?
Average weekly claims and the economy Average weekly unemployment claims are a constituent of the Conference Board LEI (Leading Economic Index). Claims have a 3% weight in the LEI. Weekly unemployment claims, if adjusted for seasonality, give investors a clear understanding of changes in the employment market. Though the Bureau of Labor Statistics releases a monthly […]

Analyzing the Yield Curve’s Ongoing Flatness
A December rate hike and a flattening yield curve The Fed rolled out another rate hike at its final meeting of 2017. The target range for the federal funds rate was increased by 0.25% to 1.25%–1.50%, and the Fed has signaled three more rate hikes in 2018. Two members dissented to the rate hike due to lower […]

Will Gold Maintain Its Close Correlation to Inflation?
The rise in inflation could be a positive sign for the current scenario.

The Curious Case of Low Inflation in 2017
The last statement from the US Fed, which was released with its recent rate hike decision, cited lower levels of inflation but hopes that the inflation target could be achieved in 2018.

A Look at Capacity Utilization across US Industries in November
In the November capacity utilization report, the manufacturing sector remained strong with 76.4% capacity utilization, the highest level since May 2008.

Will US Unemployment Rate Fall below 4% in 2017?
A lower unemployment rate is one of the key objectives of the Fed. In 2017, the unemployment rate fell, reaching 4.1% in its latest November reading.

How the US Economy Performed in 2017
This year has been a year to watch the US economy. Hopes for change, tax reform, and industry-friendly policies drove the markets (SPY) higher.

The Primary Cause of Yield Curve Flattening
Interest rates and inflation The pace of interest rate hikes and inflation rate growth have a profound influence on the US yield curve. The US Fed has been communicating its intent to increase interest rates from the current ultra-low level to a target rate of 2.5% over the next few years. The conditions required for […]

What Leads to Yield Curves Flattening
Factors leading to yield curves flattening There are multiple factors that can affect the shape of yield curves. Bonds (BND) with different maturities react differently to changes in economic conditions and expectations. For example, when the US Fed announces an interest rate hike, short-term bonds (SHY), which are to the left side of a yield curve, react […]

How Will Tax Cuts Impact the Federal Deficit?
The report from the Joint Committee on Taxation included an estimate of budgetary deficits for 2018–2027. Tax reforms could have a limited impact in 2018.

Tax Cuts and Rate Hikes Could Impact the Fed
The proposed tax cuts and the resulting increase in the federal deficit are expected to impact bond markets. It’s important to consider the Fed’s stance.

Fed’s November Beige Book and Restrained Hiring Plans
The inability of employers to find suitable workers is leading to wage increases, especially in the professional, technical (XLK), and production (XLI) sectors.

The Economic Indicators Covered by the Fed’s Beige Book
Comparing the economic performance with economic expectations and the previous cycles gives investors an idea of whether the economy is expanding or contracting.

When the United States Sneezes, Will the World Catch a Cold?
Williams suggested that the monetary policy framework should be designed considering the global scenario rather than central banks looking at their economies in isolation.

The Problem with the Current Interest Rates
With global economies progressing toward normalcy or the “new normal,” as Williams called it, central banks are moving toward normalizing policy by signaling interest rate hikes.

San Francisco Fed John Williams and Monetary Policy Challenges
John Williams, president and CEO of the Federal Reserve Bank of San Francisco, spoke on November 16, 2017, at the 2017 Asia Economic Policy Conference in San Francisco.

Why Decreasing Credit Spreads Are a Cause for Concern
The November Conference Board report, which takes October data into account, reported the credit spread at ~1.2—an improvement from the September reading of ~1.1.

The FOMC’s View of the Equity and Bond Markets
The FOMC’s November meeting minutes deemed the bond market’s yield curve to be flattening between meetings. The report indicated that bond yields have risen since the September FOMC meeting for multiple reasons.

The FOMC’s Outlook for the US Economy
As per economic projections prepared by the FOMC, US real GDP is expected to improve in the final quarter of this year.

The FOMC’s View on the US Economy
At the November meeting, the FOMC staff review indicated that US labor market conditions continued to strengthen and that the US economy continued to expand at a solid pace.