"...Meanwhile, Chris Watling, who runs Longview Economics, a London-based research firm, points to a breakdown in the relationship between the TIPS yield and forward interest rates implied by Eurodollar futures. Typically, these track each other quite closely, but the Eurodollar implied rate is now in positive territory and more than 1 percentage point higher. He expects the TIPS yield to “catch up” as evidence of economic recovery mounts. When it does, the price of gold, so far resistant to the ripples in the Treasury market, may catch up, too — by moving down..."
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