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Expand chart
Data: Federal Reserve Bank of St. Louis; Chart: Chris Canipe/Axios

The U.S. 10-year Treasury note and the 3-month Treasury bill are on the verge of an inversion. The yield spread fell to 5 basis points Wednesday, the lowest level since the financial crisis.

Why it matters: "The yield curve has been a reliable predictor of recessions, and the best summary measure is the spread between the ten-year and three-month yields," the San Francisco Fed's Michael D. Bauer and Thomas M. Mertens wrote in August.

  • The spread between 3-month LIBOR and the 10-year note already has inverted.

What they're saying: BMO Capital Markets strategist Ian Lyngen notes that Wednesday was the first time the "invert that hurts," the 3-month/10-year spread, has been flatter than the 2-year/10-year spread since January.

  • The already tight spread compressed to 5 basis points after the Fed's conference. Fed funds futures prices show investors see a greater than 35% chance the Fed cuts rates this year and a 0% chance it raises them.

What to watch: The yield curve has been inverted for some time out to 5 years, with maturities from 1-month to 3 years holding higher yields than the 5-year note.

Editor's note: The headline was corrected due to a change made in the editing process to indicate the yield curve is on verge of inversion.

Go deeper

Focus group: Former Trump voters say he should never hold office again

Illustration: Sarah Grillo/Axios

"Relief" is the top emotion some swing voters who used to support Donald Trump say they felt as they watched President Biden's swearing-in, followed by "hope."

Why it matters: For voters on the bubble between parties, this moment is less about excitement for Biden or liberal politics than exhaustion and disgust with Trump and a craving for national healing. Most said Trump should be prohibited from ever holding office again.

Updated 14 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Eniola Odetunde/Axios

  1. Health: Most vulnerable Americans aren't getting enough vaccine information — Fauci says Trump administration's lack of facts on COVID "very likely" cost lives.
  2. Politics: Biden unveils "wartime" COVID strategyBiden's COVID-19 bubble.
  3. Vaccine: Florida requiring proof of residency to get vaccine — CDC extends interval between vaccine doses for exceptional cases.
  4. World: Hong Kong to put tens of thousands on lockdown as cases surge.
  5. Sports: 2021 Tokyo Olympics hang in the balance.
  6. 🎧 Podcast: Carbon Health's CEO on unsticking the vaccine bottleneck.

Trump impeachment trial to start week of Feb. 8, Schumer says

Senate Majority Leader Chuck Schumer. Photo: The Washington Post via Getty

The Senate will begin former President Trump's impeachment trial the week of Feb. 8, Majority Leader Chuck Schumer announced Friday on the Senate floor.

The state of play: Schumer announced the schedule after reaching an agreement with Republicans. The House will transmit the article of impeachment against the former president late Monday.