Increase in oil prices leads to concerns over inflation

US Treasuries at the long end of the yield curve are being favoured by fixed interest portfolio managers who believe the US economy is slowing down. Evidence of a slowing US economy came in May with unemployment rising to 4.1% from the 30 year low of 3.9% recorded in April. US retail sales also fell in May, the second monthly decline in a row while new home construction fell to its lowest level in a year in the same month. Another concern for bond markets is the effect rising oil prices may have on inflation. Crude oil prices have risen by 33% since April in dollar terms and are close to...