Between global central bank money-printing, government fiscal support out the wazoo, and hopes for vaccine-related developments, the world and his pet rabbit is betting on inflation (and just as confidently, central planners are sure they can tame the beast should it ever get out of hand). "It's hard to resist this reflation trade at the moment," said Christoph Rieger, head of fixed-rate strategy at Commerzbank AG. "With policy all one-way and U.S. refunding coming up this week, we may require some more concessions." 'Inflationary' signals are evident everywhere : The Treasury curve is at its steepest since 2015... Source: Bloomberg Commodity prices are exploding... Source: Bloomberg and oil prices are surging... Source: Bloomberg As Global liquidity spews forth... Source: Bloomberg And the expectations for inflation are just as global, with US breakevens at their highest since 2014... Source: Bloomberg And European inflation swap rates also surging...
"La verità passa per tre gradini: prima viene ridicolizzata, poi viene contrastata, infine viene accettata come ovvia" (A. Schopenhauer)