Oil Quietly Took Over the Treasury Curve From Inflation Data

Oil is driving Treasury yields more than inflation data, and the correlation is strongest at the 10 year point rather than the two year. Shriya Samarth, Executive Director and Head of Rates, EMEA at StoneX, explains where the oil correlation now sits on the U.S. Treasury curve and what two soft inflation prints did to rate hike pricing. U.S. July CPI met expectations at 3.4% headline and 2.5% core, with decelerating gasoline prices set against pickups in services costs and airline fares. Oil takes three to nine months to reach consumer price data, so a print in line today says little about the ones that follow. A flat U.S. July PPI reading then removed full pricing of a December rate hike from the OIS curve, moving January into the frame. Discover Actionable Insights with StoneX Market Intelligence: https://shop.stonex.com/products/stonex-essential-bundle?selling_plan=4455759972&variant=45955323625572&utm_source=youtube&utm_medium=social&utm_campaign=sxtv_guest_shriya_samarth&utm_content=share 0:00 Oil Eclipses Inflation Data 0:38 Oil Needs Months to Hit CPI 1:08 Flat PPI Shifts Rate Odds 2:03 Two Year Yields Never Moved 2:25 Inflation Is Here to Stay Like and subscribe for more financial market insights. \#StoneX #CrudeOil #ShriyaSamarth #Bonds