What happened last time? › Inflation
What happens when 10-year breakeven inflation is above 2.5%?
It has happened 16 times since 2003. A year after it began, the S&P 500 was up 10 of 16 times, with a median move of +3.2%. On an ordinary day in the same years the median was +12.2%, up 83% of the time.
10-year breakeven inflation above 2.5. Not true on 2026-09-25.
What came next
| 1 month later | 1 year later | 3 years later | |
|---|---|---|---|
| S&P 500 | +1.4% 63% up · n 16 · normal +1.4% | +3.2% 63% up · n 16 · normal +12.2% | +31.4% 75% up · n 16 · normal +32.8% |
| Gold | +1.2% 56% up · n 16 · normal +0.7% | +5.0% 69% up · n 16 · normal +10.5% | +61.4% 81% up · n 16 · normal +42.7% |
| Oil | -1.1% 50% up · n 16 · normal +1.1% | +0.5% 50% up · n 16 · normal +6.3% | -17.0% 25% up · n 16 · normal +13.1% |
| 10-year yield (pts) | +0.05 pts 63% up · n 16 · normal 0.00 pts | +0.47 pts 69% up · n 16 · normal -0.03 pts | +0.02 pts 50% up · n 16 · normal -0.08 pts |
| Inflation, CPI y/y (pts) | +0.48 pts 67% up · n 15 · normal +0.03 pts | -0.97 pts 44% up · n 16 · normal +0.04 pts | -1.76 pts 25% up · n 16 · normal +0.06 pts |
| Unemployment rate (pts) | -0.10 pts 38% up · n 16 · normal 0.00 pts | -0.45 pts 31% up · n 16 · normal -0.40 pts | +0.25 pts 50% up · n 16 · normal -1.10 pts |
Median move after each episode began, how often it rose, and how many episodes had data. "Normal" is the same move from any trading day in the same years.
Every time it happened
- 2023-03-03 · true for 1 trading day · S&P 500 a year later: +27.0%
- 2022-10-20 · true for 9 trading days · S&P 500 a year later: +15.2%
- 2022-07-29 · true for 11 trading days · S&P 500 a year later: +10.9%
- 2022-02-23 · true for 85 trading days · S&P 500 a year later: -5.0%
- 2021-10-13 · true for 40 trading days · S&P 500 a year later: -15.9%
- 2021-05-10 · true for 7 trading days · S&P 500 a year later: -4.5%
- 2012-12-12 · true for 56 trading days · S&P 500 a year later: +24.3%
- 2012-09-14 · true for 12 trading days · S&P 500 a year later: +15.2%
- 2011-03-07 · true for 25 trading days · S&P 500 a year later: +2.5%
- 2008-06-26 · true for 7 trading days · S&P 500 a year later: -28.4%
- 2008-05-21 · true for 2 trading days · S&P 500 a year later: -36.1%
- 2008-03-05 · true for 7 trading days · S&P 500 a year later: -48.8%
- 2006-01-26 · true for 132 trading days · S&P 500 a year later: +11.6%
- 2005-09-15 · true for 31 trading days · S&P 500 a year later: +7.5%
- 2004-11-15 · true for 101 trading days · S&P 500 a year later: +3.8%
- 2004-04-19 · true for 41 trading days · S&P 500 a year later: +1.5%
- 16 separate episodes: a new one starts after 30 days without a match, so one long selloff counts once.
- Try enough situations and one will look like an edge by chance.
- Macro numbers are as published at the time. Stocks include companies that later died.
- How these numbers are made.
More about inflation
- What happens when inflation is above 3%?
- What happens when inflation is above 4%?
- What happens when inflation is above 5%?
- What happens when inflation is above 6%?
- What happens when inflation is above 8%?
- What happens when inflation is above 10%?
- What happens when inflation is below 1%?
- What happens during deflation (prices falling over a year)?