By Daily Crux Editor Sean Goldsmith:

Mortgage rates are back above 5%, and the world's largest investors believe the Federal Reserve will boost purchases of Treasuries to keep rates low.

30-year mortgage rates have risen more than half a percentage point in the past seven weeks, and policy makers said March 18 they were committing "greater support to mortgage lending and housing markets" by pledging to buy $300 billion of Treasuries. Of course, the government pouring money into Treasuries will push prices up and yields down... and big investors are trying to front run the purchases.

From Bloomberg:

BlackRock Inc., American Century Investments, Federated Investors and Pioneer Investment Management say it's time to buy Treasuries because the Fed will need to expand its purchases to keep consumer borrowing costs from rising further."

While government buying of Treasuries will temporarily keep yields down, and could make for a good short-term trade, it won't stop the eventual massive inflation hangover.

Read full article...

More inflation posts:

Treasury bond yields soar this week... inflationary boom coming

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Jim Rogers' prediction is coming true...