The yield curve is also good for banks, which borrow at short-term rates and lend at long-term rates. This translates to more profits and, ultimately, more free-flowing credit, comments Mark J. Perry for iStockAnalyst.
The yield curve was last seen hovering around this high level in 1992 and 2003 – both times, the economy was emerging from a recession.
For more information on Treasuries, visit our Treasury bond category.
- iShares Lehman 7-10 Year Treasury Bond Fund ETF (NYSEArca: IEF): down 5.9% year-to-date; yield is 4.11%
- iShares Lehman 1-3 Year Treasury Bond Fund ETF (SHY): up 0.7% year-to-date; yield is 2.31%
- SPDR Financial Select Sector (NYSEArca: XLF): up 17.1% year-to-date
Max Chen contributed to this article.