Intraday Market Thoughts

It's getting real with yields

by Ashraf Laidi
Aug 2, 2021 18:10

Bond yields are falling fast, but the real damage is in REAL yields (yields minus inflation) as these hit an all time low. 10-year Inflation breakevens remain stable between 2.3% and 2.5%, while nominal US 10-year yields sustain a fresh plunge to 1.16% (from 1.45% two weeks ago), causing REAL yields to hit -1.2%, leaving very little alternative competition to the non-yielding gold. Ive explained recently in this video here how the current moves are a strong reason gold will avoid the crash of 2013-14 and in this video why the Fed/USTreasury will ensure keeping real yields down and what it means for the US dollar in this video.     

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It's getting real with yields - Real Yields Gold Aug 2 2021 (Chart 1)

 
 

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