Three key developments occurred in the U.S. Treasury market today.
First, the two-year yield topped 4% for the first time in more than a decade.
The other notable news on Wednesday was that the spread between the two- and ten-year yields widened to -42 basis points. This is crucial because it typically signals a recession is coming.
Lastly, the spread between the five- and 20-year yields are close to inverting, with a spread of just five basis points.
The latest news in the Treasury market come as the U.S. Dollar Index (DXY), which gauges the greenback against a basket of currencies, reached 111.00 in the middle of the trading week. This is the best performance in more than 20 years and signals just how terrible other currencies, including the major ones, are performing.
It’s crazy out there!
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