its been going up for the past 2 weeks and nobody has really taken notice until today. good article in the wall steet journal about it.
mixture of Sep07->Dec07. later contracts were needed to offset the fact that target is recently above the effective rate. it was a stupid trade. not that the idea itself was stupid but it was extremely risky (+leveraged) and it was likely i am going to get killed before it gets better - well lesson learned the hard way.
it used to be extremely strongly correlated - now it is almost independent...(actually it is likely negatively correlated)