Yield CurveQuarterlyIQ Brief

Snapshot of key Treasury spreads, inversion depth and duration, and near-term curve risk.

Last Value Date: Jul 6, 2026

Period: Jul 6, 2026 · Source: US Treasury · Frequency: Daily

HEADLINE METRIC

35bps 10Y-2Y

Long-term Treasury rates stayed above short-term rates

The day barely changed, but the bigger picture still shows longer-term bond rates well above short-term ones.

Underlying Momentum

3m10y spread+61 bps

Curve statusNORMAL

Days inverted (10Y-2Y)0

13-week trend (10Y-2Y)Flat

The line showing interest rates for US government bonds of different lengths is staying normal, with the biggest gap still between very short and longer rates.

Risk

Risk: LOW

Why LOW:

Long-term rates near 4.45% to 4.99% can keep mortgages and other borrowing costs high. If short-term rates rise faster than long-term rates again, this normal shape could narrow and send a weaker growth signal.

Snapshot

The 10Y-2Y yield spread is 35 bps, and the 3M-10Y spread is 61 bps.

Trend

Primary trend view for the 10Y-2Y and 3m10y curve spreads.

History

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Why it matters

The shape of the yield curve can signal how investors see future growth and recession risk.

Drivers

Latest period: 2026-07-06

Driver	Level	30d change	Risk contribution	Inversion streak
10Y-3M Treasury yield spread (bps)	61 bps	-31 bps	-61 bps	No
10Y-2Y Treasury yield spread (bps)	35 bps	-18 bps	-35 bps	No
U.S. 10-year Treasury yield (%)	4.48%	-0.09 ppts	0 bps	No
U.S. 2-year Treasury yield (%)	4.13%	+0.09 ppts	0 bps	No

Forward Outlook

Consensus path for the 10Y-2Y spread and model quality signals.

Forecast path (10Y-2Y spread)

2026-07-02: 34 bps
2026-07-31: 34 bps
2026-08-31: 36 bps

Confidence band (90% CI · high)

±15 bps

>Model quality (click to expand/collapse)

Primary forecast: 34 bps
Confidence band (90% CI): ±15 bps
MAE (bps, ex-NONE): 2.72
Directional accuracy (ex-NONE): 98%
Backtest window: 2021-03-31 to 2026-07-02
Backtest observations: 65

What to Watch Next

Indicator	Why it matters	If improving	If weakening
10Y-2Y spread	This shows the gap between medium-term and longer-term Treasury rates. When the gap stays positive, the bond market looks more normal.	The gap stays above 0 and remains clearly positive. That would suggest less near-term stress than an upside-down curve.	The gap shrinks toward 0 or turns negative. That means short-term rates are higher than long-term rates, which is unusual.
3M-10Y spread	This compares very short-term rates with longer-term rates. It is a widely watched warning sign for future economic weakness.	The gap stays above 0 and holds near current positive levels. That suggests the warning signal is not active now.	The gap falls below 0. That means short-term rates are higher than long-term rates, which is unusual.
Curve status	This is the simple read on whether the Treasury curve is normal or upside-down. It helps people quickly judge whether bond markets look calm or stressed.	The status stays normal through the next few readings. That would support a steadier outlook.	The status turns flat or upside-down. That would be a more cautious signal for growth, jobs, and borrowing.
Inversion days	This counts how long the curve stays upside-down. Longer upside-down periods have often mattered more than one-day moves.	The count stays at 0 or very low. That means the unusual warning signal is not sticking.	The count starts rising and keeps building. That would show the warning signal is lasting, not just a brief move.

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