Summary: ACGB curve steeper; US Treasury curve generally more inverted.
The gradient of the ACGB yield curve became steeper this week. By the end of the week, the 3-year/10-year spread had widened by 5bps to 37bps while the 3/20 year spread finished 9bps higher at 73bps.
The various measures of the gradient of the US Treasury curve generally became more inverted. While the 2-year/10-year spread had returned to its starting point at -72bps by the end of the week, the 2 year/30 year spread finished 2bps lower at -61bps. The San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 6bps lower at -111bps.
To find out more about the yield curve and its usefulness, click here or here.