No Inflation… Unless You Need To Eat

The inflation trade is waking up

Commodities are starting to send a message. BCOM has exploded higher, grains are accelerating and a convergence of geopolitical, weather and supply shocks is pushing agricultural prices sharply higher.

So far, rates have only partly followed. But with commodities and breakevens historically moving closely together, another leg higher could make the inflation narrative much harder to ignore. Positioning is getting crowded, so expect reversals along the way, but the bigger macro signal is increasingly clear: the commodity move is starting to matter.