Investing.com – President Donald Trump may have saved Christmas (for those who hold it), but he has not saved the US from the likelihood of a recession, according to the bond market.
The 10-year and 2-year government bond yield curve flattened further on Tuesday, suggesting that pessimism in the economy continues.
At the government's announcement, cash flowed into stocks and bonds and delayed the introduction of new 1
The spread was 1.87 basis points, just a hint of inversion, which many expect in the marketplace As one of the best predictors of a recession.
One reason for the possible inverted yield curve could be the problems beyond the US borders, such as the protests in Hong Kong, which could weigh on the global economy. President Donald Trump has tweeted this afternoon that the Chinese government has moved troops to the Hong Kong border.
Another reason could be that Trump achieved a political victory over his nemesis, the Federal Reserve, by transferring responsibility for the economy back to the Federal Open Market Committee, the Fed's interest rate committee. But he may have lost economically.
According to today's collective bargaining announcement, the chances of lowering the key interest rate by half a point from the FOMC in September, according to Investing.com, dropped to around 4% from around 18% the previous day.
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