The 10yr-2yr Yield Curve is hinting to steepen
A hint sure is not a trend change. But a hint is a hint that is still in play. If the spread takes out the September high it would be time to pay attention to the potential for a trend change. Easy now; the word ‘potential’ is an important one.
The question now is whether the next real steepener is going to come from the September-October levels not seen since 2002 or from the extreme inversions of the 1970s.
When the steepener does come though, you’ll want to expect major changes in some form (not necessarily bearish or bullish, but in my opinion the potential for both with economic deceleration the main theme).
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