Summary: Slope of ACGB curve generally steeper; US Treasury curve gradient less negative.
The gradient of the ACGB yield curve generally became steeper as yields rose. By the end of the week, the 3-year/10-year spread had added 3bps to 34bps. However, the 3/20 year spread finished 3bps lower at 66bps after 20-year yields lagged the rises of shorter-dated bonds.
The gradient of the US Treasury curve became slightly less negative this week. The 2-year/10-year spread returned to its starting point at -48bps while the 2 year/30 year spread increased by 2bps to -34bps. The San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 5bps higher at -110bps.
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