These 2 very different markets have price charts that hit higher highs this week: the yield on the 10-year Treasury note and the price of oil, as seen in the actively traded West Texas futures contract.
It had an almost synchronous feel Tuesday when both established fresh 52-week highs -- if you followed along, you might think that the two actually have some kind of close relationship.
But how could that be? It's the Federal Reserve Board that holds the most sway over the direction of interest rates and it's the free markets that determine the price of oil. What kind of pull does one have on the other, to such an extent that they seem to trade in tandem?
I'm guessing that inflation fears, represented here by the continuing higher cost of petrol, are part of the reason that interest rates are headed higher, with assists from the Fed. To cool rising prices, make it more expensive to borrow money would be the idea. Just a guess.