Search Results for: spread

U.S. 10-Year/2-Year Yield Curve and Recession After the first Fed rate cut, a steepening of the U.S. 2-Year/10-Year spread could suggest a recession is coming. Image: UBS

The Yield Curve Leads VIX (Volatility) by Three Years Is more volatility expected ahead? This chart suggests that the CBOE Volatility Index or VIX usually follows the U.S. 10-year vs. 2-year Treasury spread (inverted) with a 3-year lag. Image: Morgan Stanley Research

Interest Rates for Personal Loans and Credit Cards Diverge Due to the growing spread, many borrowers take out personal loans to pay off credit card debt. Image: Axios

U.S. Twin Deficits (% of GDP) Lead the U.S. Dollar Broad REER by 18 Months The chart suggests that the U.S. dollar should weaken over time. You may also like “U.S. Twin Deficits (% of GDP) Lead Real Trade Weighted Dollar Index by Two Years” and “U.S. Dollar and Relative Growth (GDP Spread)” and “U.S. Budget…

The 10-Year minus 3-Month Yield Curve With the 3-month Treasury yield falling, the 10-year minus 3-month yield-curve spread is steepening. Keep in mind that a positive spread facilitates borrowing short and lending long. Image: Bianco Research

The Yield Curve Leads VIX (Volatility) by Three Years Is more volatility expected ahead? This chart suggests that the CBOE Volatility Index or VIX usually follows the U.S. 10-year vs. 3-month Treasury spread (inverted) with a 3-year lag. You may also like “VIX is in a Transitory State” and “Fed Funds Target Rate and VIX.”…

U.S. High Yield Credit spreads are fine. Could the market go wrong by predicting significant interest rate cuts? Image: Fidelity Investments

Conference Board Consumer Confidence Index vs. University of Michigan Consumer Sentiment Index History tells us that before a recession, the consumer confidence vs. sentiment spread always peaks and then declines. Image: Crescat Capital LLC

Initial Fed Rate Cuts and Resulting Forward Market Returns This spreadsheet also shows that the S&P 500 has performed well on average, around first Fed rate cut. Image: Fundstrat Global Advisors, LLC

Can Small Business Predict the Business Cycle? A widening high-yield spread remains a useful indicator for predicting a coming recession in the current interest rate environment. You may also like “A Widening of Credit Spreads Is Very Useful to Predict a Recession.“ Image: Quill Intelligence, LLC​

Yield Curve Inversion, How Long Until The Recession? In recent history, once the 10-Year minus 3-Month Treasury yield spread is negative and hits 10 consecutive days, it persists for weeks/months. When an inverted yield curve occurs, short-term interest rates exceed long-term rates. It suggests that the long-term economic outlook is poor and that the yields offered…