The premium for the US 10-year Treasury yield continued to fall in August relative to the “fair value” estimate based on a model developed by CapitalSpectator.com. The market rate remains moderately above the model’s estimate, but as expected in previous months (see the analysis from March, for instance) the unusually high premium is finally starting to normalize.
Daily Archives: September 12, 2024
Macro Briefing: 12 September 2024
US consumer price inflation at the headline level eased to a 2.5% year-over-year pace in August, the slowest in 3-1/2 years. Core CPI, however, remained sticky at 3.2%, unchanged from the previous month. “This isn’t the CPI report the market wanted to see. With core inflation coming in higher than expected, the Fed’s path to a 50 basis point cut has become more complicated,” says Seema Shah, chief global strategist at Principal Asset Management. Sarah House, senior economist at Wells Fargo, advises: “Inflation continues to decelerate on tend, but we’re seeing it take longer for some of the impact of the pandemic to fully unwind.”
