The yield curve uninverted on Tuesday morning. The proximate cause seems to be the hawkish inflation-fighting rhetoric now coming from typically “dovish” Fed officials.
The arrival of yet another blowout jobs report sent yields on U.S. government bonds rising on Friday—and inverted the yield curve again.
A recession indicator was tripped for a second time in two days on Friday.
A key market gauge of the risk of future recessions flashed a warning signal on Thursday afternoon.
Yields on longer-term bonds fell below shorter-term ones.
The Fed said recently that it believes its current target will remain appropriate for the foreseeable future. The market disagrees.
The bond market and President Trump agree: the Fed should cut rates.
Elaine Parker of Job Creators Network writes in the Washington Times that the broad scope of economic indicators offset the concern that the inverted yield curve suggests a recession is imminent.
