The yield curve has steepened since the Fed moved two weeks ago.

The fear investors had about a possible inversion of the yield curve did not develop after the last Fed increase two weeks ago. In fact, the yield curve steepened slightly after the December FOMC meeting . The spread between the two-year and ten-year treasury increased to 20 basis points after dropping to 13 bp prior to the meeting. The steepening curve was a function of the yield on the two-year dropping more than the decline in the yield on the ten-year over the last two weeks.

 

PROBANK AUSTIN ADVISOR - JANUARY 2, 2019