Summary: ACGB curve steeper; US Treasury curve generally more negative.
The gradient of the ACGB yield curve became steeper this week as yields fell. By the end of the week, the 3-year/10-year spread had crept up 1bp to 40bps while the 3/20 year spread finished 5bps higher at 86bps.
The gradient of the US Treasury curve generally became more negative. The 2-year/10-year spread slipped 1bp to -56bps over the week while the 2 year/30 year spread finished 3bps higher at -34bps. The San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 18bps lower at -146bps.
To find out more about the yield curve and its usefulness, click here or here.