Summary: ACGB gradient flatter; US Treasury curve inverted, although not for all measures.
The gradient of the ACGB yield curve became flatter as rises at the short end again outpaced rises elsewhere along the curve. By the end of the week, the 3-year/10-year spread had narrowed by 9bps to 29bps and the 3-year/20-year spread had lost 10bps to 60bps.
The gradient of the US Treasury curve generally became inverted, although not for all measures. The 2-year/10-year spread “tightened” by 28bps to -8bps while the 2 year/30 year spread shed 33bps to -2bps over the week. The San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 8bps tighter at 187bps.
