Geikie-Cobb: Why now is the time to buy US Treasuries

In recent months we have been buying 0-5 year US inflation-linked bonds (TIPS) as a defensive move to get exposure to the US dollar, writes MitonOptimal's Peter Geikie-Cobb.

At the time of purchase, we viewed the US bond market as still offering little value against a background of further monetary tightening by the Federeal Reserve. The big short: Fund managers warn of 'risky' Treasuries trade despite rising rate environment In addition, we felt that the market was being complacent in terms of what was being discounted for future inflation. The break-even rate of inflation, nominal yields minus real yields on TIPS, was pricing future US inflation at a little over 2% - i.e. the Fed's target rate. With the US economy re-accelerating from the Q1 slowdown...