January 25, 2018 / 2:00 PM / 2 months ago

U.S. TIPS breakeven rates rise broadly above 2 pct

NEW YORK, Jan 25 (Reuters) - The U.S. bond market’s gauges of inflation expectations rose to their highest levels in at least 10 months on Thursday, signaling growing sentiment that domestic price growth may reach the Federal Reserve’s 2-percent goal sooner than previously thought.

At 8:54 a.m. (1354 GMT), the five-year inflation breakeven rate, or the yield gap between five-year Treasury Inflation Protected Securities and regular five-year Treasury notes, was 2.02 percent, which was the highest level since March 2017. The five-year TIPS breakeven rate ended at about 1.99 percent late on Wednesday, Tradeweb and Reuters data showed.

The 10-year TIPS breakeven rate was last at 2.08 percent and the 30-year breakeven rate was last at 2.11 percent. (Reporting by Richard Leong)

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