Inflation expectations from the TIPS market remain in the range of readings seen in the first eight months of 2011 but above the range that prevailed from August 2011 until September 2012.
The Barclays 5-year/5-year forward breakeven inflation rate is currently at 2.72 percent, down about 8 bps over the past week.
There was an unusual drop in the breakeven inflation rate following a weaker-than-expected TIPS auction on April 18, but rates normalized shortly thereafter.
(Note: The breakeven inflation rate is a measure of expected inflation derived from "nominal" Treasury securities and their "real" counterparts—inflation-protected TIPS securities.)
