The Inverting Yield Curve Is About More Than Recession This Time
- Three-month, 10-year gap inverts for first time since October
- Market doubts about Fed, inflation cloud the slowdown signal
This article is for subscribers only.
A key slice of the U.S. yield curve inverted on Thursday for the first time since October, reviving memories of growth fears that plagued investors last year and signaling doubts that the Federal Reserve will succeed in reviving inflation.
The gap between the yield on three-month and 10-year Treasuries at one point slipped to as low as minus 2 basis points on Thursday. The spread -- seen by some as a warning signal because it has inverted before each of the past seven U.S. recessions -- last reached those levels as economic conditions deteriorated at the height of the trade war.