Yield Curve Blares Loudest U.S. Recession Warning Since 2007

  • Treasury 3-month/10-year inversion deepens on trade friction
  • Steeper curve may be ahead as investors ramp up rate-cut bets
BlackRock's Rieder Says Rates Could Still Rally Another 25-Basis Points
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The latest eruption in the U.S.-China trade dispute pushed a widely watched Treasury-market recession indicator to the highest alert since 2007.

Rates on 10-year notes sank to 1.714% on Monday, completely erasing the surge that followed President Donald Trump’s 2016 election. At one point, they yielded 32 basis points less than three-month bills, the most extreme yield-curve inversion since the lead-up to the 2008 crisis.