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Inflation Shields Pay Rich Returns

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Kenneth Volpert, head of taxable fixed-income at Vanguard Group in Valley Forge, Pa, says the weak economy and the Fed's easy monetary policy could lead to higher inflation. Inflation bonds strategists at Barclays Capital says the consumer price index after taking out food and energy is running at an annualized rate of 2.5% over the past 6 months and 2.9% over the past 3 months and is expected to go higher. The yield gap between 10 year TIPS and 10 year nominal Treasury notes, was trading at 2.24 percentage points on August 12, 2011 This means investors expect an annualized average rate of inflation of 2.24% in the U.S. over the next decade. This figure has declined from 2.65% in April, it is up from 1.5% in October 2010.

U.S. Treasury Inflation-Protected Securities (TIPS)

08/15/2011

TIP return for the last 12 months in August 2011 was 12%.

Grouped Articles

Inflation Below Fed Target for 22nd Month in a Row

Wall Street Journal 03/29/2014

Inflation Shields Pay Rich Returns

Wall Street Journal 08/15/2011

The Bond Bubble and the Case for Stocks

Wall Street Journal 08/22/2011

Better Ways to Fight Inflation

Wall Street Journal 10/22/2011

Inflation Pressures Ease

Wall Street Journal 11/16/2011

Inflation Hedge Is a Winner

Wall Street Journal 11/16/2011


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