Maybe — just maybe — this time is different.
An inverted yield curve is normally a bearish signal. Right now, however, it might just be bullish.It's easy to be scared by the current state of the yield curve. But maybe — just maybe — this time is different.The yield on 10-year Treasury bonds is now an astonishing 0.61 percentage points lower than the yield on 3-month Treasury bills. With the exception of one date in March 2007, that's the most inverted the yield curve has been in over 20 years.
Right now, however, 10-year yields have come down for a different reason — markets increasingly believe the Fed is going to win the battle against inflation, and therefore won't need to keep rates high for very long.in the WSJ, "the yield curve has become more deeply inverted in recent weeks due largely to good economic news."It's important to distinguish between nominal rates and real rates, which account for inflation, as St.
But let's say you believe inflation will run at a 5% pace over the next three months but only 2% over the next 10 years. Then the real rates are -0.65% at three months and +1.74% at 10 years. In real terms, the yield curve isn't inverted at all.A recession is still bound to happen eventually. But the yield curve probably isn't being very helpful in pointing analysts to when that will be.
Österreich Neuesten Nachrichten, Österreich Schlagzeilen
Similar News:Sie können auch ähnliche Nachrichten wie diese lesen, die wir aus anderen Nachrichtenquellen gesammelt haben.
Why faulty streetlights are turning cities purple — and why it's worrisomeInsider tells the global tech, finance, markets, media, healthcare, and strategy stories you want to know.
Weiterlesen »
Why this mammal eats its own brain — and why it could matter for youUnlocking the shrew’s secret to shrinking its own cognitive tissue in winter – only to regrow it in spring – may help doctors treat brain diseases in humans.
Weiterlesen »
World Cup 2022: Maybe Team U.S.A.’s Moment Is Now“There’s never been a cohort quite this creative in American soccer,” huahsu writes. “Maybe there’s no reason to wait until 2026 for them to gel.”
Weiterlesen »
Fed's Barkin: slower rate hikes, for longer and maybe higherReuters has reported that Richmond Federal Reserve Bank President Thomas Barkin on Monday said he supports smaller interest-rate hikes ahead as the ce
Weiterlesen »
Social Networks Are Going Much, Much SmallerIf the disease is “scale at all costs,” maybe intentional smallness can be the cure.
Weiterlesen »
Your Farts Could Be Telling You Something About Your Gut HealthEver wonder why a fart smells particularly bad? Or maybe you're farting more often? Here's why it could be happening, and what it means about your health.
Weiterlesen »