Ledger & Line Markets, money, and the mechanics behind the headlines.

Rates & Macro · Definition

Yield Curve

A line plotting the interest rates of bonds (usually U.S. Treasuries) across maturities, from short-term to long-term.

A normal yield curve slopes upward, because lenders demand more yield to commit money for longer. When short-term yields rise above long-term yields, the curve is 'inverted' — historically a recession warning, because it reflects market expectations that the central bank will have to cut rates.