Summary: Slope of ACGB curve flatter; US Treasury curve gradient generally flatter/more negative.
The gradient of the ACGB yield curve became slightly flatter as yields increased. By the end of the week, the 3-year/10-year spread had returned to its starting point at 51bps while the 20 year spread finished 2bps lower at 83bps.
The gradient of the US Treasury curve generally became flatter/more negative. The 2-year/10-year spread lost 13bps to +5bps while the 2 year/30 year spread shed 15bps to +22bps. The San Francisco Fed’s favoured recession-predicting measure, the 3-month/10-year Treasury spread, finished 11bps lower at -23bps.
To find out more about the yield curve and its usefulness, click here or here.