Key yield curve inverts even further as 30-year yield hits new record low - CNBC

The rate on the benchmark 30-year Treasury bond sank to a new all-time low on Wednesday while the U.S. yield curve inverted even further as fixed-income traders continue to bet on tepid inflation and slower growth in the United States.

The 30-year bond yield dropped to as low as 1.905% early Wednesday morning, breaking its prior all-time low of 1.916% clinched earlier in August. The 30-year rate later moved off those lows to trade at 1.918%, still below yields on U.S. debt of far shorter duration such as 3-month and 1-month bills.

Yield curve inversion continued to worsen on Wednesday as the yield on the benchmark 10-year Treasury note slumped further below that of the 2-year note — at 1.461% and 1.508%, respectively — after closing inverted for the second day in a row on Tuesday. 

Bond traders consider a 10-year rate below the 2-year yield an notable recession signal, marking an unusual phenomenon as bondholders receive better compensation in the short term. Before August, the last inversion of this part of the yield curve was the one that began in December 2005, two years before the financial crisis and subsequent recession.

The spread between the 3-month Treasury yield and that of the 10-year note — the Federal Reserve's preferred inversion metric — sank to -53 basis points, its lowest since March 2007.

The U.S. Treasury is set to auction $41 billion in 5-year notes.

U.S. Markets Overview: Treasurys chart

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https://www.cnbc.com/2019/08/28/us-bonds-key-yield-curve-inverts-further-as-30-year-hits-record-low.html

2019-08-28 07:37:22Z
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