The Fed will cut rates in about 20 minutes. This is what the yield curve looked like ahead of the announcement.

Yield Curve 2019-07-31 Pre-FOMC Announcement

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The yield curve, especially counting the Fed Funds Rate at 2.40% is massively inverted. The 3-month is inverted out to 10 years, but now just barely.

I will do a comparison later today of the changes.

Yield Curve Screaming for Cuts

There is currently no economic basis for a rate cut. Jim Bianco at Bianco research says the yield curve alone is reason enough.

Certainly, the yield curve is screaming for cuts along with President Trump who says Bigger is Better: A "Small Cut" Won't Do.


How Will the Curve React?

My Reply to Bianco

If the goal is to un-invert the curve I rather doubt even 50 basis points would do.

But why should that be the goal?

The yield inverted yield curve is a symptom, not the problem. I propose a recession is coming no matter what the Fed does.

The bubbles are too many and the economic distortions too great for economic policy to fix the problems.

It is impossible to un-blow bubbles.

Mike "Mish" Shedlock

Yield Curve Still Inverted Despite Fed Rate Cut

Despite yesterday's rate cut and significant moves higher in long-dated treasury yields, numerous inversions remain.

San Francisco Fed on the Predictive Power of Yield Curve Spreads

A FRBSF maco economic letter discusses the yield curve and recessions.

Fed Panic! 10-Year vs 3-Month Yield Curve Spread Un-Inverts

Over the past few weeks the 10-yr to 3-month inversion shank. That portion of the curve is no longer inverted. So what?

Checking Back In on the Yield Curve

It's been about a month since I last posted on the yield curve. Let's take a current snapshot.

Yield Curve is Inverted for Nearly 25 Years

Using the Fed Funds Rate as the baseline overnight duration, the yield curve is inverted for nearly 25 years.

Shock and Awe Needed to Un-Invert the Yield Curve: Half-Point Cut Not Enough

What would it take to un-invert the yield curve? The answer is not as simple as the math suggests.

Yield Curve Gets Serious: 10-Year to 7-Year Treasury Spread Collapses to 4 BPs

JP Morgan is following yield spreads on the GBI broad bond index. Things are getting serious says one analyst in a Tweet

What Will the Yield Curve Look Like if the Fed Hikes in Dec and March?

Futures positions imply a 92% chance the Fed will hike in Dec and 50% again in March. How will the yield curve respond?

Fed Makes Surprise Inter-Meeting 50 Basis Point Rate Cut

Fed lowers federal-funds rate range to 1% to 1.25% in its first between-meeting move since the financial crisis.