Expand chart
Data: Treasury Department; Chart: Axios Visuals

Following a yield curve inversion in March that sent tremors through financial markets, the spread between 10-year Treasury notes and 3-month T-bills has reversed and widened.

Driving the news: The inversion caused significant worry among economists and some market participants as it is one of the most reliable financial market recession indicators available.

Yes, but: While a prolonged inversion would have been worrisome, analysts say the market isn't signaling all is well with the economy just yet.

  • "I'm actually surprised we haven't seen a more meaningful selloff in bonds, given the good news that has pushed stock prices up — the delay in Brexit, the trade war and expectations for a pickup in growth in the second half of the year," Subadra Rajappa, head of U.S. rates strategy at Societe Generale, told Axios.

What to watch: Rajappa says, the rise in yields hasn't pushed the spread between 10-year and 3-month Treasuries that much higher. The difference of 15 basis points is still very tight and near levels seen in 2007.

  • "The market's much more focused on what's happening globally," she said, including growth slowdowns in Europe, Japan and China.

Bonus: The yield curve is still inverted on the short end with 1-month bills holding higher yields than maturities as long as 5 years.

Go deeper: Will the yield curve lead to recession? It really is different this time

Go deeper

Ben Geman, author of Generate
23 mins ago - Energy & Environment

Oil's turbulent long-term future

Illustration: Aïda Amer/Axios

The oil sector is facing risks from all sides.

Why it matters: Risk in the industry is nothing new. But these are especially turbulent and uncertain times. The industry's market clout has waned, the future of demand is kind of a mystery, and future U.S. policy is too, just to name three.

Meadows on Wray's voter fraud dismissal: "He has a hard time finding emails in his own FBI"

White House chief of staff Mark Meadows dismissed FBI Director Chris Wray's testimony that the U.S. has never historically seen evidence of widespread voter fraud, including by mail, during an appearance on "CBS This Morning" on Friday.

Why it matters: Meadows' statement highlights the Trump administration's strategy to sow doubt in November's election results by challenging the legitimacy of mail-in ballots, which are expected to skew heavily in Democrats' favor.

The next cliff for the unemployed

Illustration: Sarah Grillo/Axios

A program supporting Americans who are typically ineligible for unemployment benefits will expire at the end of the year, with millions still relying on it as the labor market sputters.

Why it matters: The result could be catastrophic for the economic recovery that Wall Street fears is already fragile.

Get Axios AM in your inbox

Catch up on coronavirus stories and special reports, curated by Mike Allen everyday

Please enter a valid email.

Subscription failed
Thank you for subscribing!