Psagot: Buy Israel CPI-Linked Bonds Due 2025, Sell 2022
Alert: HALISTER1
Source: BFW (Bloomberg First Word)
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UUID: 7947283
(Bloomberg) -- Psagot expects “significant correction” in 5Y5Y inflation expectations, since they have remained low without any “satisfactory economic reason,” Guy Yehuda, senior economist at Psagot writes in e-mailed note.
- Psagot recommends buying Israeli CPI-linked bonds due Oct. 2025 and selling CPI-linked bonds due Sept. 2022
- Inflation expectations for 3 years and 5 years have returned to their level since the beginning of the year, but 9-year expectations remain behind
- Shekel depreciation in past weeks, end to possibility of VAT cut, and increase in CPI data all support case for rise in long-term inflation expectations
- NOTE: April 14, Israel March consumer prices rose 0.9% from year ago vs 0.7% median economist estimate
Alert: HALISTER1
Source: BFW (Bloomberg First Word)
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To modify this alert, click here
UUID: 7947283