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Yield Curve Inversion

Market & Macro

A yield curve inversion occurs when short-term Treasury yields rise above long-term yields, resulting in a negative spread. The most closely watched inversion is when the 2-year Treasury yield exceeds the 10-year yield.

Every U.S. recession since the 1950s has been preceded by a yield curve inversion, with an average lag of 12–18 months.

Further reading: Wikipedia

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