treasury yield

Inverted Yield Curve 2023

Deepest Yield Curve Inversion Since 1981

Mark Thornton and Ryan McMaken discuss the current yield curve inversion. The U.S. Treasury funds deficit spending by issuing debt instruments with a range of maturities. Treasury Bills have maturities from one month to one year. Treasury Notes have maturities from two to ten years. And long-term debt is issued as Treasury Bonds with 20- and 30-year maturities. The yield curve is created by comparing interest rates between ten-year debt to 3-month debt. Logically, long-term debt should require a higher interest rate than short-term debt simply because a lot can happen in ten years so there is more uncertainty, i.e., risk.

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