Economics
Bill Gross and BlackRock Ponder Flat Yield Curve's True Meaning
- Gap between yields on shorter, longer maturities at decade low
- Gross sees possible slowdown, Rieder blames global demand
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The U.S. yield curve just keeps getting flatter, reaching levels not seen in a decade. What that says about investors’ economic outlook depends on who you ask.
To Rick Rieder at BlackRock Inc., long-term Treasuries are “crazy priced wrong to the expensive side,” along with debt in Europe and Japan, in part because investors in those regions flock to the U.S. any time debt prices fall. That appetite keeps 10-year Treasury yields in a tight range even as the Federal Reserve sees economic growth warranting additional interest-rate hikes.