Long TIPS Yields Hit Record Low

The long end of the Treasury inflation-protected securities yield curve fell to an all-time low last week.

  • 11 Feb 2005
Email a colleague
Request a PDF

The long end of the Treasury inflation-protected securities yield curve fell to an all-time low last week. The yield of the April '32s fell to 1.72% on Feb. 8, the lowest since the issue was released in 1998. Alex Li, interest-rate strategist at Credit Suisse First Boston, said he considers the drop surprising given the Federal Reserve continues to raise interest rates, but sees the buying of longer-dated paper by pension managers trying to match assets and liabilities as a major factor in driving up prices on the issuance (BW, 2/4).

The yield of the April '32s hit a high in 2000 of 4.4%. Over 2004, yields on the issuance stayed within a range of 1.9% to 2.5%.

Other interest-rate strategists say the falling of the TIPS curve follows the general trend of curve flattening. "All long securities are falling in yield. Long principals blasted through previous all-time low yields," said one TIPS strategist.

The new low was partly caused by the market's rally on Feb. 4 after the nonfarm payroll data was released but is also a sign of reduced growth expectations by market participants. "It's a reflection economic growth over the long term will be slow," Li said.

  • 11 Feb 2005

All International Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 JPMorgan 102,994.82 409 8.29%
2 Citi 96,697.47 362 7.78%
3 Barclays 82,826.79 294 6.66%
4 Bank of America Merrill Lynch 82,541.75 313 6.64%
5 HSBC 66,026.80 322 5.31%

Bookrunners of All Syndicated Loans EMEA

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Bank of America Merrill Lynch 8,946.93 17 9.40%
2 Deutsche Bank 6,056.30 15 6.36%
3 Commerzbank Group 5,474.20 22 5.75%
4 BNP Paribas 5,160.94 25 5.42%
5 UniCredit 4,424.51 19 4.65%

Bookrunners of all EMEA ECM Issuance

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 2,328.59 11 11.04%
2 Morgan Stanley 2,132.71 13 10.11%
3 Bank of America Merrill Lynch 1,598.67 7 7.58%
4 JPMorgan 1,544.99 8 7.32%
5 UBS 1,229.93 7 5.83%