Summary: ACGB curve steeper; US Treasury curve 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 widened by 3bps to 38bps while the 3/20 year spread finished 9bps higher at 81bps.
The gradient of the US Treasury curve generally became more negative. The 2-year/10-year spread had decreased by 10bps to -78bps by the end of the week while the 2 year/30 year spread finished 11bps lower at -68bps. However, the San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 6bps higher at -110bps.
To find out more about the yield curve and its usefulness, click here or here.