Our “recession barometer” kicks in when the “spread” between the 10-year rate and the 2-year rate for Treasuries in the USA and Government of Canada Bonds in Canada reach 0.00x, which means that the yield on the 10s equals the yield on the 2s. If the 10s yield less than the 2s, an “inversion” occurs and then it is likely that a recession will soon follow. Predicting when that will be is the key.
You can access this week’s report on the spread of the 10-year/2-year yield curve here … … DayChart_021519_YC10-2CanUSA
