By Murray Coleman

Matt Hougan isn't the only one skeptical about official CPI data. So apparently are bond traders dealing in Treasury Inflation-Protection Securities [TIPS].

The breakeven spread in 10-year TIPS widened after the most recent CPI data was released, notes John Jansen. An ex-official with the Federal Reserve Bank of New York and long-time bond trader, his daily blogs at the "Across the Curve" site are great reading. (I like to keep up with them through Seeking Alpha, as a matter of fact, which posts his latest and greatest comments).

Jansen noted that earlier in the year when financial markets seemed to be facing disaster (i.e., Bear Stearns (BSC) going bankrupt), the spread between nominal bonds and TIPs traded on the wide end of this year's range around 257 basis points. As of yesterday, that was back to around 245 basis points.

That's notable, says Jansen, since the wider the spread gets the greater the out performance of TIPS relative to conventional nominal bonds.

A discussion with a portfolio manager indicated to him that "many participants think that there was an overly aggressive seasonal factor applied this month (in the CPI data) which depressed the inflation rate."

Jansen added that many traders and portfolio managers seem to be waiting "for the next round of data, which they believe will manifest inflation in a more virulent form."