Uncertainty Rules!

Uncertainty Rules! By Elwin de Groot, head of macro strategy at Rabobank US Treasury yields drifted higher yesterday after the Financial Times reported, citing people close to Fed Chair Kevin Warsh, that he would be prepared to raise rates as early as September if incoming inflation data surprise to the upside and markets themselves begin pricing a more hawkish path. Yet the market reaction was not confined to the front end suggesting investors were not interpreting the story in a straightforwardly hawkish manner. That ambiguity is understandable. If markets push yields higher...