Bonds & Rates

Yield curve

A comparison of yields across bonds of similar credit quality but different maturities.

Plain-English context

Put the definition to work.

ILLUSTRATIVE EXAMPLE

A curve with a two-year yield above a ten-year yield has an inversion at those points; it is not a precise forecast of a recession date.

IMPORTANT DISTINCTION

An inversion's economic interpretation depends on the compared maturities and context; it does not date a recession precisely.

Further reading and verification. Examples are hypothetical, not current quotes or recommendations. Product terms, tax treatment and market rules can change. Investor.gov — bonds and fixed income

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