Is it a fair comment to say that as the shorter maturity yields start to drop, that longer term yields (specifically 10+ years) are most likely to stay flat or possibly drop as well? Any possible roadmap to where the long end goes higher than where it currently is?
Gary January 19, 2023
Yes, if inflation renews and ramps they’ll all probably go higher. If the deflationary view holds sway then they’ll drop, with the short end dropping harder (as casino patrons flock to liquidity) and the yield curve steepens.
Is it a fair comment to say that as the shorter maturity yields start to drop, that longer term yields (specifically 10+ years) are most likely to stay flat or possibly drop as well? Any possible roadmap to where the long end goes higher than where it currently is?
Yes, if inflation renews and ramps they’ll all probably go higher. If the deflationary view holds sway then they’ll drop, with the short end dropping harder (as casino patrons flock to liquidity) and the yield curve steepens.