Summary: ACGB curve flatter; US Treasury curve more negative.
The gradient of the ACGB yield curve became flatter this week as yields rose. By the end of the week, the 3-year/10-year spread had shed 2bps to 39bps while the 3/20 year spread finished 7bps lower at 81bps.
The gradient of the US Treasury curve became more negative. The 2-year/10-year spread shed 14bps to -55bps over the week while the 2 year/30 year spread finished 24bps lower at -37bps. The San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 1bp lower at -128bps.
To find out more about the yield curve and its usefulness, click here or here.