Summary: ACGB gradient steeper; US Treasury curve gradient also steeper.
The gradient of the ACGB yield curve became flatter as yields at the short end rose more than those elsewhere along the curve. By the end of the week, the 3-year/10-year spread had narrowed by 4bps to 53bps and the 3-year/20-year spread had shed 10bps to 95bps.
The gradient of the US Treasury curve also became flatter, although not for all measures. The 2-year/10-year spread tightened by 6bps to 40bps over the week while the 2 year/30 year spread lost 8bps to 70bps. However, the San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 7bps wider at 165bps.
