4 ms·
5.6% Yields right now for the next 6 months. Hold for 2 years yields drop to 5%. We still have an inverted yield curve. hold for 20 Y >> 5.3%
by boringg 3y ago
5.6% Yields right now for the next 6 months. Hold for 2 years yields drop to 5%. We still have an inverted yield curve. hold for 20 Y >> 5.3%
- dragontamer 3y agoOver the long term, the yield will uninvert and normalize. The problem is that we don't know if it will happen with short-term rates dropping, or if long-term rates increasing (or which combination thereof). If short-term rates remain 5.5%+ like they are today, the yield-curve could normalize with 10Y being at 7% or higher, meaning today's 10Y at 5% would be a bad buy. Alternatively, if short-term rates drop to 3% and thus 10Y declines to 4.5% (but still normalizes), then buying 10Y at 5% today would be a good idea and better than buying a 10Y later.