Brian Cheung | Yahoo Finance | May 7th, 2019
Falling Treasury yields are raising questions about whether the market is signaling another coming recession, since inverting yields have had a strong track record of predicting downturns. The yield curve is viewed as a thermometer on market expectations over time and long-term yield at levels below short-term yield signals gloomier outlooks of the future.
A rocky month of trading in December began with the yield on the 5-year Treasury note dipping below the yield on the 3-year note. Although markets have traded up since the new year, the Treasury market continued to flatten and in late March, the yield on the 10-year Treasury fell below the yield on the 3-month Treasury bill as the Fed signaled no more rate hikes for 2019.