WEEKLY WRAP-UP (s2023 e2)

for the week ending Friday, July 14th, 2023

The tightening in real rates at the front-end has been massive

Rewind back to March 16th, 2022, when Powell embarked on his first rate hike. A few days earlier, the 2-year TIP yield was -3.00%. This means that over the next two years, a buyer of this TIP would receive inflation minus 3%. If inflation was 2% (the Fed’s target), the buyer would earn a whop…