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Treasury Curve Inversion Deepens to Level Not Seen Since 2007

  • 10-year yield drops as much as 12 basis points below 2-year
  • Flattening trend stalls after weak 10-year note auction
Updated on

One of the US bond market’s most widely watched indicators of potential recession risk has reached levels last seen in 2007.

The yield on the benchmark 10-year Treasury note dropped as much as 12.4 basis points below the 2-year rate, eclipsing the 9.5-basis-point gap reached in early April. The inversion shrank back to around 9 basis points after weak demand for a 10-year note auction cheapened yields in that part of the market.