Summary: ACGB curve steeper; US Treasury curve flatter.
The gradient of the ACGB yield curve became steeper as yields fell by greater amounts at the short. By the end of the week, the 3-year/10-year spread had gained 16bps to 50bps and the 3-year/20-year spread had increased by 18bps to 82bps.
In contrast, the gradient of the US Treasury curve finished the week flatter. The 2-year/10-year spread tightened by 10bps to 33bps while the 2 year/30 year spread lost 2bps to 50bps over the week. The San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 36bps tighter at 194bps.
