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Treasury yields have climbed since the summer as inflation tightens financial conditions and the Federal Reserve raises borrowing costs. Corporate warnings, weak restaurant sales, and higher gas and commodity prices suggest that inflation is pressuring consumers and business margins while the economy loses momentum.
is one of the most important things happening in markets right now. Actually, this started in the summer, but you know what I mean.
"I would say not a crisis but an eye-opener, and it's something I think you've got to think about," BlackRock chief investment officer of global fixed income Rick Rieder said on Yahoo Finance'sBut I don't want you to lose focus on the"why" behind the move. It's not because of some warning on the nation's debt from some third-rate investing pundit. That's not the reason at all. The reason is that the economy is weakening under the tightening grip of inflation.
And this is going down just as the Federal Reserve makes it costlier for businesses and you, the consumer, to borrow money. PAYX) warned about more quarters of pressured margins at the hands of a big pickup in inflation in things like wheat, diesel, and packaging. I think this sheds light on what the Fed hawks like) said sales at its Olive Garden chain grew just 1.1% in the quarter.
The read: Much higher gas prices are swallowing up the disposable income of many households. It's always important to know the"why" when it comes to markets — and sadly, the"why" isn't great in the case of yields.
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