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Topic: Yield curve

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	Yield curve - Wikipedia, the free encyclopedia
		In finance, the yield curve is the relation between the interest rate (or cost of borrowing) and the time to maturity of the debt for a given borrower in a given currency.
		Yield curves are used by fixed income analysts, who analyze bonds and related securities, to understand conditions in financial markets and to seek trading opportunities.
		Yield curves are usually upward sloping asymptotically; the longer the maturity, the higher the yield, with diminishing marginal growth.
	en.wikipedia.org /wiki/Yield_curve#External_links (2940 words)

	Yield (finance) - Wikipedia, the free encyclopedia
		The relationship between yields and the maturity of instruments of similar credit worthiness, is described by the yield curve.
		The yield of a debt instrument is generally linked to default probability of the issuer.
		Inflation is linked to the yield in the sense that fears of high inflation in the future would mean that investors would ask for high yield today.
	en.wikipedia.org /wiki/Yield_(finance) (251 words)

	U.S. Treasury - Daily Treasury Yield Curve
		Yields are interpolated by the Treasury from the daily yield curve.
		This curve, which relates the yield on a security to its time to maturity is based on the closing market bid yields on actively traded Treasury securities in the over-the-counter market.
		The yield values are read from the yield curve at fixed maturities, currently 1, 3 and 6 months and 1, 2, 3, 5, 7, 10, 20, and 30 years.
	www.treas.gov /offices/domestic-finance/debt-management/interest-rate/yield.html (250 words)

	FPA Journal - Reaching for Yield: Lessons from the Past
		In particular, we find that when the yield spread is positive and wide, the odds are in favor of switching to short-term bonds, and conversely, when the spread is negative (inverted yield curve), the odds are strongly in favor of staying in T-bills.
		When yields do not change, bond returns and bill returns will be equal to their initial yields, and the initial spread will perfectly predict the subsequent differences in returns.
		The intercept is -1.00 and the slope coefficient is 2.11.
	www.fpanet.org /journal/articles/2006_Issues/jfp0206-art8.cfm (4417 words)

	Zero coupon yield curve
		Yield curves are one way of reproducing the situation of a bond market in graphic form.
		Typically, a yield curve would be a graph of the internal rates of return of the bond over the years to maturity.
		For the given 30 observations (1 year up to 30 years to maturity) of the euro par yield curve are calculated the corresponding 30 points of the zero coupon yield curve.
	epp.eurostat.cec.eu.int /cache/ITY_PUBLIC/EYC/EN/page4.htm (235 words)

	Yield Curve -- A complete definition
		Also known as the term structure of interest rates, the yield curve is a graph that plots the yields of similar-quality bonds against their maturities, ranging from shortest to longest.
		In general, when the yield curve is positive, this indicates that investors require a higher rate of return for taking the added risk of lending money for a longer period of time.
		Because the yield curve is generally indicative of future interest rates, which are indicative of an economy's expansion or contraction, yield curves and changes in yield curves can convey a great deal of information.
	www.streetauthority.com /terms/y/yieldcurve.asp (784 words)

	Greg Mankiw's Blog: What does an inverted yield curve mean?
		That is why the slope of the yield curve is one of the variables in the index of leading indicators.
		yield curve, usually measured as the difference between the longest yield in the dataset and the shortest maturity yield.1 The higher the slope or term spread, the larger GDP growth is expected to be in the future.
		The inverted yield curve is related to recessions because of the "stepping too hard on the brake" phenomenon by the Fed. The link between short and long rates is not that strong.
	gregmankiw.blogspot.com /2006/06/what-does-inverted-yield-curve-mean.html (1389 words)

	Incredible Charts: Yield Curve
		Negative yield curves have proved to be reliable predictors of economic recession over the past 50 years.
		The yield curve inverted at [a] and was followed by a sharp fall in the SandP 500.
		The yield curve then slopes downwards and is referred to as a negative (or inverted) yield curve.
	www.incrediblecharts.com /economy/yield_curve.htm (742 words)

	FDIC: FYI - What the Yield Curve Does (and Doesn’t) Tell Us
		Chart 1 shows that the yield curve did not invert before the two recessions that occurred in the late 1950s and early 1960s, a period when long-term yields were exceptionally low, as they are today.
		The inverted yield curve during 1966, the near-inversions in both 1987 and 1995, and the inversion in 1998 are also examples of inaccurate growth signals.
		Second, the flatness of the yield curve could be due to the easing of long-term inflation expectations, which are an important component of the term premium.
	www.fdic.gov /bank/analytical/fyi/2006/022206fyi.html (4174 words)

	Why Is The Yield Curve Inverted?
		America's yield curve is essentially flat at the moment with the 10-year Treasury yield at 4.35% and the Fed Funds rate at 4.25%.
		An inverted yield curve is uncomfortably predictive of future recessions: Japan's yield curve was wildly inverted just prior to the collapse of the Nikkei and the long economic winter that followed; in America, six recessions since the 1960s have been presaged by inverted yield curves.
		The yield curve reflects two phenomena: (1) it is riskier to loan for a long time, so long bonds must yield more than short to compensate, (2) a second factor is a function of supply and demand plus anticipated future short rates.
	www.yeald.com /Yeald/a/40331/why_is_the_yield_curve_inverted.html (1028 words)

	Understanding a flattening yield curve
		A yield curve is a graph that shows the relationship between yields and maturity dates for a given time.
		When economic forces cause a shorter maturity to produce a greater yield than a long maturity, the yield curve is said to be inverted.
		Yields for short-term maturities, such as the one-year and five-year Treasuries, are rising faster than the yield for the 10-year Treasury.
	www.bankrate.com /brm/news/sav/20050617b1.asp (174 words)

	Yield Curve Inverts - ICMA-RC (Site not responding. Last check: 2007-09-19)
		An inverted yield curve is a byproduct of an interest rate environment in which long-term debt instruments have a lower yield than short-term debt instruments of the same credit quality.
		Previous yield curve inversions have typically signaled a slowing economy or the beginnings of a recession; the past four recessions in the United States were preceded by an inverted yield curve.
		It is important to remember that the yield curve is one factor, among many, that serves as a leading indicator as to where the economy is headed.
	www.icmarc.org /xp/rc/marketview/chart/2006/20060106yieldcurve.html (559 words)

	Bernanke and the yield curve
		Bernanke also raised the possibility that the narrowing in the yield spread could be on account of expectations that short-term interest rates are likely to fall in the future as a result of a possible economic slowdown or a recession.
		This upwardly sloping curve (in excess of the slope that allows for the risk factor) cannot be sustained since it sets in motion forces that are working towards the flattening of the curve.
		It is this that prompts the change in the shape of the yield curve to be seen as a leading indicator of economic activity.
	www.brookesnews.com /060304yieldcurve.html (2136 words)

	Historical Yield Curve
		The yield curve is what economists use to capture the overall movement of interest rates (which are known as "yields" in Wall Street parlance).
		When it gets wider than that -- and the slope of the yield curve increases sharply -- long-term bond holders are sending a message that they think the economy will improve quickly in the future.
		To become inverted, the yield curve must pass through a period where long-term yields are the same as short-term rates.
	fixedincome.fidelity.com /fi/FIHistoricalYield (1223 words)

	Bernanke's Yield Curve Confusions - Mises Institute
		The Fed Chairman has concluded that the consequent narrowing in the spread between the long-term and the short-term interest rates (flattening in the yield curve) may imply that the present interest rate stance of the US central bank is either too easy or too tight.
		Bernanke also raised the possibility that the narrowing in the yield spread could be due to expectations that short-term interest rates are likely to fall in the future as a result of a possible economic slowdown or a recession.
		The key to the shape of the yield curve is that long-term interest rates are the average of expected future short-term rates.
	www.mises.org /story/2098 (2072 words)

	Inverted Yield Curve
		This type of yield curve is the rarest of the three main curve types and is considered to be a predictor of economic recession.
		An inverted yield curve is sometimes referred to as a "negative yield curve".
		Due to this historical correlation, the yield curve is often seen as an accurate forecast of the turning points of the business cycle.
	www.investopedia.com /terms/i/invertedyieldcurve.asp (275 words)

	Riding the Yield Curve
		In fact, analysts have viewed inverted yield curves before each of the last five recessions in the U.S. humped curve occurs when long-term yields are the same as short-term yields.
		A common fear is that a humped curve signals the beginning of a recession because the yield curve must pass through this intermediate stage in order to become inverted.
		Although a humped curve does often signal slower economic growth, the primary force behind an inverted curve is investors' favorable expectations of the future.
	www.kiplinger.com /personalfinance/basics/archives/2003/04/bonds4.html (453 words)

	Yield Curve
		A normal yield curve (pictured here) is one in which longer maturity bonds have a higher yield compared to shorter-term bonds due to the risks associated with time.
		A flat (or humped) yield curve is one in which the shorter- and longer-term yields are very close to each other, which is also a predictor of an economic transition.
		The slope of the yield curve is also seen as important: the greater the slope, the greater the gap between short- and long-term rates.
	www.investopedia.com /terms/y/yieldcurve.asp (357 words)

	Principal India - Yield Curve (Site not responding. Last check: 2007-09-19)
		The graphical depiction of the relationship between the interest rates (or yields) on bonds of the same credit quality and different maturities is known as the yield curve.
		In other words, the yield curve is a depiction of debt market interest rates across maturities, with time being plotted on the X-axis and yields on the Y-axis.
		Flat Curve: For a yield curve to change from normal to inverted, it may pass through a phase where long-term rates are more or less equal to short-term rates (see figure).
	www.principalindia.com /presentation/view/LearningCenterArticleDetail.aspx?ArticleID=10 (587 words)

	[No title]
		The last time the yield curve inverted was in 2000, before the last U.S. recession and a period of aggressive rate cuts by the Federal Reserve.
		The yield curve's current shape implies a probability of a recession within the next four quarters of between 15% and 20%, according to Estrella and Mishkin's research.
		Two years ago, the yield curve was extremely steep, with 2.5 percentage points separating the yields on the 2- and 10-year notes.
	www.marketwatch.com /News/Story/Story.aspx?guid={75F7335A-1D0F-4026-AC99-691051568374}&source=blq/yhoo&dist=yhoo&siteid=yhoo (1050 words)

	What is a Yield Curve?
		A yield is commonly defined as a crop or harvest; in this case the harvest is financial.
		The shape of the curve on the yield curve chart holds a variety of meanings for bond investors, but there are two basic ways of viewing it.
		Research has shown that the yield curve is a better predictor of the economy than studying the stock market.
	www.wisegeek.com /what-is-a-yield-curve.htm (435 words)

	Is the inverted yield curve cause for worry? - Dec. 27, 2005
		Unlike the last time the yield curve inverted in 2000 -- signaling the beginning of the post-bubble economic downturn -- this time around, market strategists are taking a glass-half-full stance on the prospects for the economy.
		The yield curve refers to the slope of rates in the Treasury bond market, and an inverted yield curve traditionally signals a slowing economy or a recession.
		In the past, whenever the yield curve inverted and a recession followed, both short-term rates and long-term rates were on the rise.
	money.cnn.com /2005/12/27/news/economy/inverted_yield_curve (1151 words)

	Yield Curve
		An inverted yield occurs when the rate for 3-month debt is higher than the rates for longer terms of debt, all the way to 30-year bonds.
		An inverted yield curve is therefore produced by fear: business borrowers' fears of not being able to finish their on-line capital construction projects and lenders' fears of a recession, with its falling interest rates and a falling stock market.
		The yield curve for U.S. Treasury debt certificates is the one that investors use to predict the economy.
	www.garynorth.com /public/department81.cfm (981 words)

	Euro par yield curve
		It is based on yield observations of actively traded bonds in euro, weighted by the stock of bonds issued in euro (see data sources).
		Another "historical graph" compares the present curve with the curves of one year and two years ago.
		The curve is calculated using a regression formula, on the basis of the yield and the residual maturity of the selected bonds.
	epp.eurostat.cec.eu.int /cache/ITY_PUBLIC/EYC/EN/eyc-EN.htm (349 words)

	Inverted Yield Curve
		It is sometimes referred to as a negative yield curve.
		Partial inversion is when only some of the short term treasuries (5 or 10 years) have yields higher than the 30 year ones.
		The yield curve can accurately forecast the turning points of the business cycle.
	baystreet.investopedia.com /terms/i/invertedyieldcurve.asp (135 words)

	Twists and Turns in the Yield Curve [Fool.com: Motley Fool Take] December 28, 2005
		The yield curve is essentially a chart that shows the difference between short-term and long-term interest rates.
		Furthermore, there were extremely flat yield curves in 1995 and 1998 (albeit not inverted) that were false recessionary signals; the economy subsequently continued to grow both times.
		Interestingly enough, therefore, an inverted yield curve may be a positive for equities, not a negative, and investors may become more interested in equities, which have lagged other asset classes (e.g., commodities) over the past few years.
	www.fool.com /News/mft/2005/mft05122816.htm (843 words)

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