Weakness of durable U.S. Treasury bond yields have fallen significantly, and “reflation” trading has cool somewhat, but policy uncertainty may still cause interest rates to fluctuate at high levels. This week, the 10year US Treasury bond rate fell significantly, with the TIPS rate falling by about 14BP, while the impli inflation expectations did not buy phone number list change much. However, in the short term, in the early days of Trump’s presidency, the uncertainty of many policies and the resilience of the economy may cause US Treasury bond yields to still tend to fluctuate at high levels.
2. Why is US core inflation lower than expect?
Why was US inflation lower than market expectations in December? Mainly durable goods, follow by rental inflation. Global oil prices rose in December, which push the energy CPI up sharply monthonmonth in December. The main reason for the weakening of US inflation in December was core inflation, among which the subitems that weaken monthonmonth were mainly durable goods (the monthonmonth pull on CPI fell by 4BP compar with November), follow by rent (the pull on CPI fell by 2BP).
The cooling of durable goods inflation in the csat is the percentage of positive reviews Unit States may be mainly due to the temporary cooling of consumption. The main determinants of durable goods consumption are income and interest rates. The recent rise in U.S. Treasury bond yields and a slight slowdown in U.S. resident wage growth may lead to a cooling of durable goods consumption (weaker motor vehicle sales in December) and inflation. But the Manheim uscar price index suggests vehicle inflation could rebound in the short term.
Rental inflation cool slightly in a single month
An the trend of “deinflation” in rental prices may continue. U.S. rental inflation follows the transmission logic of “house prices new mobile lead leases rental CPI”. Although U.S. house prices indicate that rental inflation may rebound, the growth rate of the New Tenancy Index (NTRI) releas by the BLS continues to decline, so rental inflation may hardly become a factor in reversing “deinflation”Weakness of durable.