{"id":144170,"date":"2019-03-22T11:40:22","date_gmt":"2019-03-22T15:40:22","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=144170"},"modified":"2022-09-20T16:55:15","modified_gmt":"2022-09-20T16:55:15","slug":"us-10-year-bond-yield-inverts-with-3-month-1-year-early-recession-warning","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2019\/03\/us-10-year-bond-yield-inverts-with-3-month-1-year-early-recession-warning\/","title":{"rendered":"US 10-Year Bond Yield Inverts with 3-Month & 1-Year: Early Recession Warning"},"content":{"rendered":"
March 22, 2019<\/div>
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By CountingPips Research<\/strong><\/p>\n

\"\"<\/a>(Yield Curve Inversions with Recessions in grey)<\/span><\/em><\/p>\n

The US Treasury benchmark bond market inverted earlier today and according to history, a recession warning is triggered. Yield curve inversions occur when the yield on a longer-term bond falls below that of a shorter-term bond, signaling a sort of ‘upside-down’ situation that happens very rarely in the bond markets.<\/p>\n

The benchmark 10-Year bond yield has fallen to a low of 2.43 percent in markets today while the yield on the \"\"<\/a>3-Month bond has held steady at the 2.46 percent level. This means there is a -0.03 inversion in the 10Year-3M curve.<\/p>\n

The 1-Year bond yield has also been stable around the 2.46 percent level for an identical -0.03 inversion in the 10Year-1Year curve.<\/p>\n

The shorter end of the yield curve (5-Year yield) has actually been inverted since December and today, the 5-Year bond yield (2.25%) has\u00a0 accelerated further below both the 3-Month (2.46%) and the 1-Year (2.46%).<\/p>

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The historical significance of a yield curve inversion is that it can be a reliable warning that a recession will occur anywhere from approximately nine months to two years after the inversion.<\/p>\n

The reasoning goes that investors are rushing into longer-dated treasuries (10-Years) because the growth outlook is diminished in their eyes and warrants a flight to safe assets.<\/p>\n

The inversion of the yield curve does not mean that it is an absolute certainty a recession will happen but the track record has been pretty good.<\/p>\n

According to the Cleveland Federal Reserve — which does a great job of tracking this monthly<\/a>, (although not up to date yet) — the inverted yield curve has predicted the last seven recessions.<\/p>\n

By CountingPips Research – Visit our Investment Blog<\/a>
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All information and opinions on this website are for general informational purposes only and do not constitute investment advice.<\/em><\/p>\n

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 <\/p>\n","protected":false},"excerpt":{"rendered":"

By CountingPips Research (Yield Curve Inversions with Recessions in grey) The US Treasury benchmark bond market inverted earlier today and according to history, a recession warning is triggered. Yield curve inversions occur when the yield on a longer-term bond falls below that of a shorter-term bond, signaling a sort of ‘upside-down’ situation that happens very […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-144170","post","type-post","status-publish","format-standard","hentry","category-investment-news","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/144170","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=144170"}],"version-history":[{"count":5,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/144170\/revisions"}],"predecessor-version":[{"id":174376,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/144170\/revisions\/174376"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=144170"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=144170"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=144170"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}