Sentences with phrase «of the yield curve on»

Now, eighteen months later, what is the verdict of the yield curve on the cycle?

Not exact matches

The drop in yields in the «long end» of the curve this year has raised concerns that in winding down stimulus too soon, the Fed is giving up on its goal of reflating the economy.

NEW YORK, Nov 28 - The Federal Reserve faces the challenge of standing by as financial markets «correct» as the central bank trims its asset holdings, U.S. hedge fund manager David Tepper said on Tuesday, adding he was surprised the bond - yield curve was so flat.

The outlook warned, however, that it is important to keep an eye on the yield curve — which tracks the movement of both the 10 - year and the two - year treasury yield.

In a note sent out to clients on Thursday, the team of Shahid Ladha and Timothy High wrote there are several factors that point to even higher yields and a steeper yield curve in the US.

The yield curve - the plot of all of the yields on Treasury securities of maturities from four weeks to 30 years - is used as a signal of economic health of the economy.

Though currently bank equity investors are cheering the steepening of yield curves, meanwhile, the 2003 Japan episode should fix regulators» attention on the growing home - bias in government bonds.

In contrast, bond market exposure (in the form of yield curve and spread risk) has played a relatively minor role in driving convertible bond risk and return in the recent past and seems likely to play a minor role in the year ahead, based on our model.

Securities on the long end of the yield curve have longer maturities.

Although the focus on the yield curve has led to fewer bond purchases, the Bank of Japan may have little choice but to continue to inject significant amounts of liquidity into an economy that remains beset by demographic challenges.

Achievement of these goals was considered by the HRC as very challenging, even aggressive, given the expected modest economic growth for 2007 for the financial services industry, the impact and duration of the on - going flat / inverted yield curve (meaning short - term interest rates that are virtually equal to or exceed long - term interest rates, thus lowering profit margins for financial services companies that borrow cash at short - term rates and lend at long - term rates), potentially higher credit losses, fewer available high - quality, high - yielding loans and investment opportunities, and a consumer shift from non-interest to interest - bearing deposits.

These announcements generally had larger effects on the short end of the yield curve.

These steps include: efforts to simplify prospectus requirements for retail vanilla bonds and ease the personal liability of company directors; improving market transparency through the RBA's publication of new measures of corporate bond yields; the lengthening of the government bond curve; and the listing of certain fixed - income securities on the Australian Securities Exchange.

Our alpha transmission process centers on making key decisions across all four of our alpha pods — duration, sector allocation, yield curve and currency.

Traditionally, global equities do not peak until after the yield curve has inverted, he adds, but «given the very low - rate nature of this cycle, we'd expect a flat curve to weigh more heavily on sentiment and encourage a more defensive rotation.»

Efficient pricing in fixed - interest markets depends, to a large extent, on the existence of a well - defined yield curve for an asset of undoubted credit worthiness.

The Bank of Japan overnightsaid it would continue its 80 trillion yen of asset purchases, but it would focus on steepening the yield curve.

The Barron's article pointed this out as well, citing London - based «G+E conomics» head Lena Komileva: «A surplus of investment funds looking for returns in low - yield global markets results in a cap on longer - term yields and a flat yield curve.»

One of the first pieces I read on the slope of the yield curve, which continues to influence my thinking to this day, was written in the 1980s by economists Arthur Laffer and Victor Canto.

The long end of the yield curve has risen as well, perhaps on expectations of faster inflation.

On the short - side of the yield curve, the consensus seems to interpret the Federal Open Market Committee's recent use of the word «gradual» as an indication that it will allow inflation to run higher than 2 % in order to make up for the last 20 years of below - target growth.

The shape of the yield curve can be a barometer for future growth, but its shape depends on a number of factors.

The spread between the 2 - year note yield and the 10 - year note yield, a widely - watched measure of the yield curve, widened to 49 basis points, or 0.49 percentage point, from 41 basis points on Tuesday.

Interest rates at all points on the yield curve converge to roughly 5.89 % over the course of 5 years on the rising rate path, and to 16.2 % on the falling rate.

One of the indicators some economists have their eye on right now is what's known as the flattening yield curve — or the difference between long - term and short - term Treasury yields.

The new fund will reportedly focus on three strategies; using algorithms to identify attractive bond valuations, option overlays to provide protection against sudden market movements, and taking advantage of opportunities in yield curve movements.

The curve is a comparison of yields on everything from the one - month Treasury bill to the 30 - year Treasury bond.

With the exception of the very front end of the yield curve, Canadian government bond yields declined, as did spreads on investment grade corporate bonds.

Since the final year of the recession, which spanned 2007 to 2009, the 3 - month Treasury Bill rate, a proxy for monetary policy, has put upward pressure on mortgage rates in recent years while the yield curve has put downward pressure on mortgage rates.

Though I'm not inclined to put much weight on projections or forecasts, the present shape of the yield curve is one that has historically been followed by a parallel upward shift in interest rates at all maturities.

In doing so, investors are taking on a range of risks such as exposure to changes in the shape of the yield curve, credit spreads or exchange rates.

This suggests that the determination of the 10 - Year Treasury Note rate, the sum of the 3 - month Treasury Bill rate and the yield curve, largely rests on the height of the federal funds rate at the end of the cycle.

Like the yield curve, an understanding of credit spreads can uncover value and give you a reading on where markets and the economy may be headed.

As usual, I don't place too much emphasis on this sort of forecast, but to the extent that I make any comments at all about the outlook for 2006, the bottom line is this: 1) we can't rule out modest potential for stock appreciation, which would require the maintenance or expansion of already high price / peak earnings multiples; 2) we also should recognize an uncomfortably large potential for market losses, particularly given that the current bull market has now outlived the median and average bull, yet at higher valuations than most bulls have achieved, a flat yield curve with rising interest rate pressures, an extended period of internal divergence as measured by breadth and other market action, and complacency at best and excessive bullishness at worst, as measured by various sentiment indicators; 3) there is a moderate but still not compelling risk of an oncoming recession, which would become more of a factor if we observe a substantial widening of credit spreads and weakness in the ISM Purchasing Managers Index in the months ahead, and; 4) there remains substantial potential for U.S. dollar weakness coupled with «unexpectedly» persistent inflation pressures, particularly if we do observe economic weakness.

The gap between the 2 - year and 10 - year Treasury notes, often considered the heart of the yield curve, held at 46.8 basis points on Thursday.

In recent years, short - term rates have put upward pressure on mortgage rates while the yield curve has largely been flattening since the end of the last recession.

As the yields on these bonds change, the «shape» of the yield curve changes.

The long end of the UST curve is already just as unenthused as ever, while the short end expects higher yields on money substitutes.

In Australia, we have come to think of the downward sloping yield curve as the norm, and banks have developed cash management - type products to cater for those wishing to capitalise on high short term interest rates.

In fixed income, rate hikes by the Fed have led to higher interest rates on the short end of the yield curve, while longer - term rates have remained more contained (despite recent increases following tax reform).

If inflation pressures become bad enough to force excessive rate hikes, what often follows is an inversion of the yield curve — when the interest rates on shorter - maturity bonds rise above rates on longer - maturity bonds.

This led to debates among policymakers on whether the Fed should hasten the pace of tightening, which further exacerbated pressure on short - term Treasury yields while leaving long - term rates largely unchanged — hence a flatter yield curve.

In any case, investors should keep in mind that the stock market's reaction to Fed cuts has historically been dependent on other conditions such as valuations, economic expectations and the slope of the yield curve.

Hence, a flat yield curve can be seen as a yardstick of ineffective policy normalization focusing on the «wrong part of the term structure.»

Prior to each of the last seven recessions (shaded bars on chart), the yield curve was inverted with short - term rates higher than longer - term rates.

Depending on where rates land, the intermediate sector of the yield curve could outperform, or it could get clobbered.

«As much as there's a lot of hoopla about this increased lending and profitability, all the lending in the world is not going to matter if Treasurys are right about growth and inflation going forward given this flattening of this yield curve,» he also said on «Closing Bell.»

FRA: Given the potential in Europe for being the epicentre of perhaps the next financial crisis as Peter Boockvar mentions, could we see international capital flows come from Europe and elsewhere to the U.S. markets especially as you mentioned there could be pressure on the long end of the yield curve with the movement into equities.

Now, the slowdown in money supply growth and the bank credit flattening of the yield curve will occur well before there is any noticeable impact on a broad array of economic indicators or long lags in monetary policy.

«The multi-year massive expansion of the Fed's balance sheet has had a recognized powerful effect on asset markets — lowering yields and flattening the yield curve.