How strong is the correlation between the inflation rate and 30-year treasury yields? The following data published by Fuji Securities are given as pairs of inflation rates and treasury yields for selected years over a 35-year period.
Inflation Rate
30-Year Treasure Yield
1.57%
3.05%
2.23
3.93
2.17
4.68
4.53
6.57
7.25
8.27
9.25
12.01
5.00
10.27
4.62
8.45
Compute the Pearson product-moment correlation coefficient to determine the strength of the correlation between these two variables. Comment on the strength and direction of the correlation.
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