Summary: Slope of ACGB curve a little flatter; US Treasury curve gradient more inverted.
The gradient of the ACGB yield curve became a little flatter as yields fell. By the end of the week, the 3-year/10-year spread had lost 3bps to 52bps while the 3/20 year spread finished unchanged at 87bps.
The gradient of the US Treasury curve became more inverted this week. The 2-year/10-year spread decreased by 15bps to -43bps and the 2 year/30 year spread finished 18bps lower at -29bps. The San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 17bps lower at -87bps.
To find out more about the yield curve and its usefulness, click here or here.