By Nick Kalivas
Tue 15 May 2012 09:21:58 CT
After a period of strength relative to the core inflation rate, the headline CPI has converged to the core CPI on a year over year basis. Although high, the weaker tone in gasoline prices should help to put some pressure on inflation. Likewise, the recent sell off in livestock prices may help to ease food inflation. Note the Smuckers cut its coffee prices today. However, the core inflation rate has not moved lower and shows a steady uptrend. Both measures are above the 10 year treasury yield on a year over year basis and highlight the treasury market is poorly valued.
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