Flat Yield Curve Coming?

Bill Baruch
By Bill Baruch of Blue Line Futures
President, Blue Line Futures •

With food and fuel continuing to rally, will the price moves cancel out the Fed's efforts through interest rate hikes to curb inflation?

Image Source: Pixabay

With food and fuel continuing to rally, will the price moves cancel out the Fed's efforts through interest rate hikes to curb inflation? There is currently a 60% chance that we will see 5 rate hikes this year and Crude Oil has not flinched, reaching a Mar 22' contract high.

  • Policy errors from Washington & around the world will cause energy prices to remain high.
  • The inability for OPEC+ to bring on more production.
  • Spare capacity simply is not there.

Moving on to Bonds, the 10yr yield is holding between 1.7-1.9%. Rising rates in the front of the curve will flatten it, which is a precursor to a recession. Are we revisiting 2018-19 inversion levels without the ability to ease? How many rate hikes are actually possible?

Video Length: 00:07:21

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