There’s More Juice Left In The Trade For Higher Real Yields
Authored by Simon White, Bloomberg macro strategist,
TIPS continue to mean revert and risk overshooting to the downside, leading to a continuation in rising real yields.
Real yields in the US have had a remarkably good run, with 10-year reals bottoming at about 1.72% at the end of March and rising to near 20-year highs at 2.43% currently. That’s even more remarkable when you consider that oil has on net risen almost 70% over the same period.
TIPS were overbought coming into the Iran war, but are now back to their mean. As the chart below shows, TIPS’ annual return is a mean-reverting series, with a decaying mean. Like a pendulum, when the series gets back to its mean it typically overshoots.
If that was to recur, then we should expect real yields to keep rising.
That is consistent with the message from my leading indicator for real yields. Its inputs include G10 excess liquidity and the Federal Reserve’s policy rate, and it anticipates the 10-year real yield rising more over the next three months or so.
Short positioning in TIPS looks elevated, based on the short interest of the iShares TIP ETF. We’re not likely to see significant short covering while momentum is in the bears’ favour.
In shares terms, the short interest is not as high as it was during the inflation flare of 2021/22 and subsequent rapid Fed tightening, but the short interest ratio, ie normalised by the shares outstanding, is at a similar level to what it was back then.
There are different drivers this time. Fed pricing is not as big a part of it, with only two and a bit rate hikes expected over the next year. Instead it’s a combination of rising real growth expectations and greater competition for capital, driven by the seemingly insatiable demand for investment in AI infrastructure.
A good slug of the rise in real yields this year, however, also comes from increasing risk premium for TIPS. No wonder short positioning is high.
Tyler Durden Wed, 09/09/2026 – 08:05
Source: https://freedombunker.com/2026/09/09/theres-more-juice-left-in-the-trade-for-higher-real-yields/
Anyone can join.
Anyone can contribute.
Anyone can become informed about their world.
"United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.
Before It’s News® is a community of individuals who report on what’s going on around them, from all around the world. Anyone can join. Anyone can contribute. Anyone can become informed about their world. "United We Stand" Click Here To Create Your Personal Citizen Journalist Account Today, Be Sure To Invite Your Friends.
LION'S MANE PRODUCT
Try Our Lion’s Mane WHOLE MIND Nootropic Blend 60 Capsules
Mushrooms are having a moment. One fabulous fungus in particular, lion’s mane, may help improve memory, depression and anxiety symptoms. They are also an excellent source of nutrients that show promise as a therapy for dementia, and other neurodegenerative diseases. If you’re living with anxiety or depression, you may be curious about all the therapy options out there — including the natural ones.Our Lion’s Mane WHOLE MIND Nootropic Blend has been formulated to utilize the potency of Lion’s mane but also include the benefits of four other Highly Beneficial Mushrooms. Synergistically, they work together to Build your health through improving cognitive function and immunity regardless of your age. Our Nootropic not only improves your Cognitive Function and Activates your Immune System, but it benefits growth of Essential Gut Flora, further enhancing your Vitality.
Our Formula includes: Lion’s Mane Mushrooms which Increase Brain Power through nerve growth, lessen anxiety, reduce depression, and improve concentration. Its an excellent adaptogen, promotes sleep and improves immunity. Shiitake Mushrooms which Fight cancer cells and infectious disease, boost the immune system, promotes brain function, and serves as a source of B vitamins. Maitake Mushrooms which regulate blood sugar levels of diabetics, reduce hypertension and boosts the immune system. Reishi Mushrooms which Fight inflammation, liver disease, fatigue, tumor growth and cancer. They Improve skin disorders and soothes digestive problems, stomach ulcers and leaky gut syndrome. Chaga Mushrooms which have anti-aging effects, boost immune function, improve stamina and athletic performance, even act as a natural aphrodisiac, fighting diabetes and improving liver function. Try Our Lion’s Mane WHOLE MIND Nootropic Blend 60 Capsules Today. Be 100% Satisfied or Receive a Full Money Back Guarantee. Order Yours Today by Following This Link.
| Visits: | 1,831,518,131 |
| Stories: | 8,701,799 |
Whistler Blowers, Insiders
