Sentences with phrase «slope yield curve»

Putting the recent market indigestion into context, the positively sloped yield curve offers some comfort by suggesting the selloff may be short - lived and could be an opportunity to take advantage of cheaper valuations.

• Maybe Banks and Insurers: So long as there's an upward - sloping yield curve, banks should benefit.

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.

Although downward sloping yield curves have dominated the landscape in Australia in the deregulated era, positive sloped yield curves have been the norm in a number of other countries, particularly those with relatively low inflation (see table).

R / C ≈ 1: healthy continuously upward - sloping yield curve when information arrival and consumption rates are approximately equal.

In general terms, yields increase in line with maturity, giving rise to an upward - sloping yield curve or a normal yield curve.

At present, the positively sloped yield curve is allowing some banks to repair by borrowing short and lending long.

An upward sloping yield curve is favorable to a bank as the bulk of its deposits are short term and their loans are longer term.

An inverted or down - sloped yield curve suggests yields on longer - term bonds may continue to fall, corresponding to periods of economic recession.

The increasing onset of demand for longer - maturity bonds and the lack of demand for shorter - term securities lead to higher prices but lower yields on longer - maturity bonds, and lower prices but higher yields on shorter - term securities, further inverting a down - sloped yield curve.

A normal or up - sloped yield curve indicates yields on longer - term bonds may continue to rise, responding to periods of economic expansion.

Not exact matches

While the slope of the yield curve today may point to more modest returns in future years, we believe the bull market still has room to run.

My top three indicators include: a widening of high yield credit spreads; consecutive negative readings in the Chicago Fed National Activity Index; and a negatively sloped, or inverted, yield curve.

The yield curve, which normally slopes upward, has extended its tightening trend as lackluster economic data have pushed down long - dated yields even as senior Fed officials» backing for a gradual - but - sustained hiking trajectory have lifted long - dated yields.

The difference between long - term and short - term interest rates is known as the «slope of the yield curve», or «the term spread.»

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.

Nonetheless, at around 65 basis points, the slope of the yield curve remains below its medium - term average (Graph 67).

Consensus is for no change and I would agree with that for the Aussie dollar has been stable and the 2/10 yield curve is a healthy 135 basis points positive slope.

From low valuations, average stock market returns have been strong in both periods where the yield curve was upward sloping and where it was inverted.

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.

In cases since 1960 where the slope of the yield curve was inverted, 10 - year bond yields actually rose following the Fed's first rate cut - an average of 43 basis points over the next 12 months and 15 basis points over the next 18 months.

Currently, the yield curve is positively sloped (longer term rates above shorter term rates) which does not suggest a recession is imminent.

Looking ahead, if the yield curve maintains its current slope and the federal funds rate hits the Fed's long - term target, the 10 - year treasury yield will exceed 3 % in a few years.

Financial firms tend to shrink when the yield curve is flattish and certainly when negatively sloped.

The eventual goal is to manage monetary policy aiming for a yield curve that has a low positive slope, allowing the banks to make a little money, but not a lot.

The yield curve typically slopes upward to reflect the increased risk associated with lending over longer time horizons.

If you follow global financial trends, you would have noted the continual (and recently accelerating) decline in the slope of the US yield curve.

Then, just move Fed funds to keep the yield curve slope near that 0.25 % slope.

Another indicator of financial conditions is the slope of the yield curve, as measured by the spread between the yield on 10 - year bonds and the target cash rate.

While the combination of rapid credit growth and below - average interest rates suggests that financial conditions remain expansionary, the slope of the yield curve, as measured by the spread between the yield on 10 - year bonds and the cash rate, suggests a somewhat different picture.

Given what I know about the Fed's reaction function, I believe pre-conditions favor Fed tightening irrespective of the slope of the yield curve.

They found that «the slope of the domestic yield curve provides information about the likelihood of future recessions in all eight countries studied.»

It is my contention that the slope of the yield curve changes relatively consistently through loosening and tightening cycles.

This sounds like an interesting scenario to use your grid analysis, where your quantiles might be ranked using (1) equity / mortgage REIT spreads and (2) monetary policy (measured by either short term rates or yield curve slope).

The slope of the Treasury curve for that effect to be active now, particularly since high yield spreads have widened out from earlier in 2007.

This is only one day, but the yield curve slope, measured by the difference in yields between 10 - year and 2 - year Treasuries, widened 10 basis points today.

Looking at slope of the yield curves 10 - years to 2 - years, the Treasury curve has widened 20 bp and the swap curve 23 bp.

What this means is that there are intrinsic levels of risk affecting the yields on high quality corporate debt, lessening the positive slope of their spread curves, or with agencies inverting the spread curves.

My idea was to stop at a yield curve with a modestly positive slope.

Beats me; the slope of the yield curve today is adequate to allow banks to make money; if the Fed waits at these levels, the economy should recover over the next two years.

Spread curves of high yield bonds tend to invert when the Treasury yield curve is steeply sloped.

When you start to see the yield curve flatten or even invert, meaning short - term rates become equal to or higher than long - term rates, and the line either becomes flat or sloped lower from left to right, then that usually signals trouble ahead in terms of a recession and lower market prices.

Another signaling mechanism that breaks down when policy rates are set low for an extended period of time is slope of the yield curve.

Credit spreads continue to be elevated versus their levels earlier this year, and the slope of the Treasury yield curve remains flat.

The same is true for those who rely on yield curve slope to indicate likelihood of recession or expansion.

Then: the Fed funds rate was below 2 %, and the yield curve was steeply sloped.

No doubt, the slope of the yield curve, as measured by the spread between two - and 10 - year government bonds, has been flattening since 2014 in both Canada and the United States, and the trend has recently intensified: as we headed into December, the curve sat at its flattest level since the Great Recession.

In a balanced economic environment, longer - term investments demand a higher rate of return than shorter - term investments, thus the upward sloping shape of the yield curve.

The slope of the yield curve has received a lot of attention lately.

Most often, the Treasury yield curve is upward - sloping.