One of the best-known recession indicators is flashing warning signs on the economy. Yields on longer-term U.S. government bonds are in danger of slipping below yields on short-term bonds, a relatively rare occurrence known as an “inversion,” according to Axios.
Inverted yield curves can reflect a rising risk of economic recession, and analysts and investors closely watch for this early warning sign.
Right now, the yield on the 10-year note is now only about one-quarter percentage point higher than the two-year note, with many analysts expecting to see the 10-year fall below the two-year sometime soon.
Whether a recession follows could depend on whether the Federal Reserve continues to constrain the economy with rate hikes if and when an inversion occurs. Read the full story.
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