Summary: ACGB curve steeper; US Treasury curve again displays inconsistency.
The gradient of the ACGB yield curve became steeper as the rises of shorter-term Australian yields were outpaced by the gains of their longer-term counterparts. By the end of the week, 3-year/10-year and 3/20 year spreads had both gained 5bps to 26bps and 61bps respectively.
The various measures of the gradient of the US Treasury curve again displayed some inconsistency. The 2-year/10-year spread moved further into inverted territory as it lost 4bps to -42bps over the week while the 2 year/30 year spread returned to its starting point at -14bps. The San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 5bps tighter at 28bps.
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