Inflation's hot again - and rates show it

Price pressures reaccelerated in 2026. April CPI hit 3.8% year over year, the highest since May 2023. The next day, PPI surprised even more at 6.0% year over year, the largest wholesale print since December 2022.

Bond markets noticed: the 30-year Treasury has moved past 5% and the 10-year is near 4.49%. After back-to-back upside surprises, passing on inflation protection is a harder argument to make.

TIPS: the cleanest link to CPI

Treasury Inflation-Protected Securities lift their principal alongside CPI, so you earn a real yield above whatever inflation ends up being.

• TIP: iShares TIPS Bond ETF sits at the top of the segment, managing roughly $15 billion and spanning the full curve. Expense ratio: 0.18%.
• STIP and VTIP: If you want inflation linkage without heavy rate sensitivity, iShares 0-5 Year TIPS Bond ETF concentrates on the short end and carries meaningfully less duration than TIP while still reflecting CPI. Vanguard Short-Term Inflation-Protected Securities ETF takes a similar short TIPS approach at just 0.03%.
• SCHP: Schwab U.S. TIPS ETF offers full-curve TIPS exposure at 0.03%, the lowest-cost broad option. It returned roughly 1.5% through April 2026 in a tough bond market.

Commodities and energy: where inflation bites first

When raw materials get pricier, it flows straight into CPI and PPI - and 2026 has made that crystal clear.

• PDBC: Invesco Optimum Yield Diversified Commodity Strategy ETF is up roughly 30% year to date, powered by strong energy and broad commodity gains. Its portfolio consists of futures contracts in energy, metals, and agriculture. From a legal/operational standpoint, it's organized under the 1940 Act as an open-ended ETF and gains commodity exposure via an offshore subsidiary, producing a typical 1099 rather than a K-1. Expense ratio: 0.59%.
• DBC: Invesco DB Commodity Index Tracking Fund offers a very similar blend, comprising more than a dozen futures contracts, with a roughly 22% gain in the past 12 months. It issues K-1s, which creates tax headaches for many; for taxable accounts, PDBC is typically the simpler choice.
• GSG: iShares S&P GSCI Commodity-Indexed Trust leans harder into energy, a plus this year with WTI crude above $101, but it's more volatile and also issues K-1s.

Cash that pays and how to position

Ultra-short Treasuries are not a classic inflation hedge, but they matter when long bonds get hit and yields are competitive. The iShares 0-3 Month Treasury Bond ETF (SGOV) now exceeds $85 billion in size, yields roughly 3.9%, and, with near-zero duration, is barely affected by rate swings. Meanwhile, long-duration bond ETFs have been punished as the 30-year crossed 5%; TLT has taken significant losses, while SGOV offers stability and pays you to wait.

There is no one-and-done solution. A workable blend would use TIPS to tie directly to CPI, commodities for real-asset exposure, energy stocks for amplified earnings when oil rises, and ultra-short Treasuries to safeguard principal. One factor dominates right now: duration.

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In an inflation-driven, rising-rate backdrop, shorter-dated exposures have consistently led - think STIP over TIP, SGOV over AGG. That pattern held through this week's CPI and PPI double shock and likely sticks until inflation cools meaningfully.

Prefer a single fund? PDBC provides broad commodity-based inflation hedging with the cleanest tax setup. Building sleeves? VTIP, PDBC, XLE, and SGOV cover the major transmission channels while keeping duration risk in check.

Keeping a calm, diversified approach helps preserve purchasing power and build wealth. Our CEO Jaspreet Singh is hosting a FREE live investor workshop, How to Profit From A Dollar That's Losing its Value, on September 29th. Sign up free to join him live.