A sign of recession? Long and short interest rates are temporarily reversed

In New York's bond market on the 29th, the two-year bond yield rose, and the long reversal of the long and short interest rates temporarily exceeded the yield of 10-year bonds.

It has been two and a half years since September 2019 when trade friction between China and China intensified. In the near future, the economy is expected to be backed up and there is a growing concern that the Federal Reserve's sharp monetary tightening may threaten the economy.

Bond yields are usually higher for the longer term, but the two-year bond yield rose to around 2.39 percent on the 29th and exceeded the 10-year bond.

The two year bond yield reflects the economic outlook for the market. The two-tier reversal is said to show the market's view that the economy will soon deteriorate after the Fed's interest rate rises, a market economist said.

However, in recent financial markets, fluctuations in the market price have increased due to the policy shift to the tightening from the Fed and the Russian invasion of Ukraine.

Philadelphia Federal Reserve Chairman Harker Harker said in a speech at the 29th lecture that it was "not a complete prediction", and that the reversal of long and short interest rates was only a phenomenon. In the market, there are few other people who say that there is little signal showing the recession.