Tag: yield curve

The Theory Behind Yield Curve Prediction

Commentary Since the U.S. yield curve inverted, predicting recession ahead, there have been voices again arguing “this time is different.” Like previous recessions, contrarians challenged the lack of theoretical basis behind it, others accused the yield curve slope as mainly governed by Fed policy which should be the true cause of boom-bust. In terms of…


Recession Red Flag Flashes as Bellwether 2-10 Yield Curve Inverts

A recessionary red flag was raised on Monday when the yield curve inverted on the bellwether 2-year/10-year U.S. Treasury spread on expectations that the Federal Reserve might tighten monetary policy faster and further in a bid to tame soaring inflation. The U.S. 2-year Treasury yields climbed above 10-year borrowing costs on June 13 for the first…


Explainer: Yield Curve Inversions

Recently, the yield curve inverted—albeit only for a couple of days. Pundits are now debating whether this is portending an imminent recession. But what is the yield curve? What does it mean for the yield curve to be inverted? Do yield curve inversions matter? And is a recession imminent? What is a Yield Curve Inversion?…


Explainer: Why are Yield Curve Inversions Seen as a Recession Indicator?

Recently, the yield curve inverted—albeit only for a couple of days. Pundits are now debating whether this is portending an imminent recession. But what is the yield curve? What does it mean for the yield curve to be inverted? Do yield curve inversions matter? And is a recession imminent? What is a Yield Curve Inversion?…


Inversion of Key US Yield Curve Slice Is a Recession Alarm

NEW YORK—A closely monitored section of the U.S. Treasury yield curve inverted on Tuesday for the first time since September 2019, a reflection of market concerns that the Federal Reserve could tip the economy into recession as it battles soaring inflation. For a brief moment, the yield on the two-year Treasury note was higher than…


The One Chart the Smart Money Is Watching Like a Hawk

Commentary With the stock market having escaped January in one piece, all eyes in the market will now be turning to the month of March. When the snow starts to melt, thoughts of spring occupy people’s minds, and the FOMC meets for their second meeting of the year. This will be the big one. The…


Yield Curve Control: Another Recipe for Stagnation

Commentary Central banks don’t manage risk, they disguise it. You know you live in a bubble when a small bounce in sovereign bond yields generates an immediate panic reaction from central banks trying to prevent those yields from rising further. It’s particularly evident when the alleged soar in yields comes after years of their having…