Treasury Yield Curve History and Inversions
Direct answer: The yield curve plots U.S. Treasury yields across maturities (3-month to 30-year). A normal curve slopes upward (long-term rates higher than short-term). An inverted curve (short-term higher than long-term) has preceded every U.S. recession since 1970. The 2-year/10-year curve inverted in July 2022 and remained inverted through late 2024, the longest sustained inversion since the 1980s.
Treasury Yield Curve Snapshots (Selected Dates)
| Date | 3-Month | 2-Year | 10-Year | 30-Year | 2s10s Spread |
|---|---|---|---|---|---|
| Jan 2020 | 1.55% | 1.57% | 1.88% | 2.30% | +0.31% |
| Aug 2020 (COVID low) | 0.09% | 0.14% | 0.52% | 1.22% | +0.38% |
| Jan 2022 | 0.06% | 0.78% | 1.63% | 2.08% | +0.85% |
| Jul 2022 (inversion) | 2.38% | 3.05% | 2.93% | 3.10% | -0.12% |
| Oct 2022 (peak) | 4.03% | 4.48% | 3.96% | 3.97% | -0.52% |
| Dec 2022 | 4.42% | 4.43% | 3.88% | 3.97% | -0.55% |
| Jun 2023 (max inversion) | 5.42% | 4.87% | 3.84% | 3.85% | -1.03% |
| Dec 2023 | 5.33% | 4.43% | 3.97% | 4.20% | -0.46% |
| Sep 2024 (Fed cuts begin) | 5.02% | 3.64% | 3.81% | 4.09% | +0.17% |
Source: U.S. Treasury: Daily Treasury Yield Curve Rates. Last verified: September 2026.
Frequently asked questions
Why does yield curve inversion predict recessions?
The yield curve inverts when short-term rates (controlled by the Fed) rise above long-term rates. This typically happens when: the Fed raises rates aggressively to fight inflation, and the bond market believes this will slow the economy (long-term rates fall to reflect future rate cuts and lower growth). The inversion represents the market pricing in a future recession and Fed rate cuts. Every U.S. recession since 1970 was preceded by a 2s10s inversion (6-18 months lead time typically). The 2022-2024 inversion was unusually long and deep (-1.03% at June 2023 peak) without a recession materializing through 2024, raising questions about whether this cycle is different.
What does yield curve steepening mean?
Yield curve steepening occurs when the spread between long-term and short-term rates widens. This happens when: (1) the Fed cuts short-term rates faster than long-term rates fall (typical at start of easing cycles); (2) inflation expectations rise (long-term rates rise while short-term rates are anchored by Fed policy); (3) economic growth outlook improves (long-term rates rise on growth optimism). Steep yield curves are generally positive for bank profitability (banks borrow short-term, lend long-term) and are associated with economic expansion.
Is the 2s10s the most important yield spread?
The 2-year/10-year spread is the most widely cited yield curve indicator, but other spreads are also tracked. The 3-month/10-year spread (the academic favorite for recession prediction research) also inverted in 2022 and has a similar record. The 5-year/30-year spread measures expectations for medium-term vs. long-term rates. The 2-year/30-year spread is the broadest measure. Each spread provides slightly different information about market expectations. New York Fed research favors the 3-month/10-year for recession probability modeling; financial media favors 2s10s for its simplicity and institutional following.