HSBC Favors Long-Dated U.S. Inflation-Protected Bonds

HSBC strategist Dhiraj Narula said in a report that HSBC considers long-dated U.S. inflation-protected securities, or TIPS, to have investment value. According to Jin10, he said TIPS yields are currently at their highest levels in decades, while recent sharp increases in real rates have contrasted with a drop in breakeven inflation spreads, which remain low despite higher oil prices amid renewed geopolitical tensions in the Middle East. He said the main reason is that several Fed members have delivered a more decisive message on price stability and stressed their commitment to the 2% inflation target.