Pederson predicts I bond rate of 1% to 2.6%
Monday, April 3rd, 2006
Categorized as: Yesterday's News (old post archive)
Watch out, the I bond rate is about to dip sharply is the headline on a Susan Tompor article released this morning in the Detroit Free Press. Tompor is a financial columnist at the newspaper.
Tompor's source is Detroit author Dan Pederson, author of Savings Bonds: When to Hold, When to Fold and Everything in Between.
Pederson's crystal ball is showing the same movie mine is, which I described here Friday.
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Tom, the way the article reads, do you think the 1-2.6% estimate includes an increased fixed rate? I don't think it does. For instance, it states that higher inflation would get it closer to the 2.6% mark, and it only introduces the possibility of a higher fixed rate at the end of the article.
So, I think the 1-2.6% is actually based on a 1% fixed rate, i.e. 0-1.6% inflation rate. Unfortunately Mr. Pederson doesn't give a fixed rate prediction this time around except to say there's a chance it might be higher. At least, he and you are on the same page this time, Tom. Come on Dan Pederson, fixed rate guessing is fun! … do I hear a 1.9? 2.0? …