Summary: ACGB gradient slightly steeper; US Treasury curve gradient a touch flatter.
The gradient of the ACGB yield curve became slightly steeper as yields declined at the short end. By the end of the week, the 3-year/10-year spread had widened by 4bps to 53bps and the 3-year/20-year spread had gained 3bps to 101bps.
In contrast, the gradient of the US Treasury curve generally became a touch flatter. The 2-year/10-year spread slipped 1bp to 60bps over the week while the 2 year/30 year spread slipped 1bps to 90bps. However, the San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 10bps higher at 168bps.
