Summary: Slope of ACGB curve flatter; US Treasury curve gradient more negative.
The gradient of the ACGB yield curve became flatter as yields fell after four consecutive weeks of steepening. By the end of the week, the 3-year/10-year spread had lost 3bps to 47bps while the 3/20 year spread finished 4bps lower at 79bps.
The gradient of the US Treasury curve became more negative this week. The 2-year/10-year spread shed 15bps to -34bps while the 2 year/30 year spread finished 18bps lower at -14bps. The San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 14bps lower at -134bps.
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