Yield curve steepening
MacroDefinition
Long-end Treasury yields rising faster than short-end yields, OR short rates falling faster than long. Two flavors: bull steepening (Fed cuts → short rates plunge) and bear steepening (long-end inflation fears → long rates rise).
Steepening is generally healthy for bank profits, the economy, and risk assets. Bull steepening often signals incoming rate cuts; bear steepening can signal inflation re-acceleration concerns.
Steepening is generally healthy for bank profits, the economy, and risk assets. Bull steepening often signals incoming rate cuts; bear steepening can signal inflation re-acceleration concerns.