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Treasury Curve Inversion Deepens as Yields Jump and Then Plunge

The inversion of the Treasury yield curve deepened Wednesday as the market proved volatile once again, with yields surging on the back of increased confidence about the prospect of Federal Reserve hiking interest rates and then tumbling anew before the day was out.

The gap between 2-year and 10-year Treasury yields shifted to a fresh extreme, with the longer rate dropping to be as much as 38 basis below the longer benchmark. That level on the widely watched yield curve metric, seen by many as a potential harbinger of recession, hasn’t been seen since 2000.