The Market's Favorite Recession Indicator Just Flashed Its Starkest Warning Since 2007
By gvwebguy
Published 5 years ago on
August 7, 2019
Share
[aggregation-styles]
Markets Insider
Markets Insider
The spread between three-month and 10-year Treasury yields — a relationship known as the yield curve — on Monday inverted to its widest level since 2007.
At its most extended point, the spread reached -32 basis points. That’s a worrisome sign for economists and traders alike, considering such an inversion has preceded every US recession of the past 50 years. And while the relationship has been in negative territory for months now, it’s the severity of Monday’s shift — and the reasons for it — that have traders on high alert.
This latest escalation was spurred by the Chinese central bank’s decision to let the yuan slide below a key threshold versus the US dollar. China also said it would cease importing US agricultural products.
At its most extended point, the spread reached -32 basis points. That’s a worrisome sign for economists and traders alike, considering such an inversion has preceded every US recession of the past 50 years. And while the relationship has been in negative territory for months now, it’s the severity of Monday’s shift — and the reasons for it — that have traders on high alert.
This latest escalation was spurred by the Chinese central bank’s decision to let the yuan slide below a key threshold versus the US dollar. China also said it would cease importing US agricultural products.
by Carmen Reinicke | 05 Aug 2019
RELATED TOPICS:
Get a 3D First Look at Merced’s High-Speed Rail Station Design
Events /
3 hours ago
California Court to Decide on Transgender Ballot Measure Wording
Politics /
3 hours ago
Rare House Vote Sees Ukraine, Israel Aid Advance as Democrats Join Republicans
Politics /
5 hours ago
Full Jury and 6 Alternates Seated in Trump’s Hush Money Trial
Crime /
5 hours ago
Real Estate Experts Talk Fresno’s Economic Future. Are Tough Times Ahead?
The Fresno Economic Development hosted a panel of experts to lay out their vision of the Fresno economy for the coming year on Thursday nigh...
Economy /
7 mins ago
Categories
Latest
Videos
Economy /
7 mins ago
Real Estate Experts Talk Fresno’s Economic Future. Are Tough Times Ahead?
Sports /
1 hour ago
Unlocking the Secrets to Fresno State’s Superb Baseball Season
Events /
3 hours ago
Get a 3D First Look at Merced’s High-Speed Rail Station Design
Politics /
3 hours ago
California Court to Decide on Transgender Ballot Measure Wording
Politics /
5 hours ago
Rare House Vote Sees Ukraine, Israel Aid Advance as Democrats Join Republicans
Crime /
5 hours ago
Full Jury and 6 Alternates Seated in Trump’s Hush Money Trial
Economy /
1 day ago