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

Updated 42 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 10 a.m. ET: 19,412,292 — Total deaths: 722,066 — Total recoveries — 11,773,112Map.
  2. U.S.: Total confirmed cases as of 10 a.m. ET: 4,945,795 — Total deaths: 161,456 — Total recoveries: 1,623,870 — Total tests: 60,415,558Map.
  3. Politics: Trump says he's prepared to sign executive orders on coronavirus aid.
  4. Public health: Fauci says chances are "not great" that COVID-19 vaccine will be 98% effective
  5. Science: Indoor air is the next coronavirus frontline.
  6. World: Africa records over 1 million coronavirus cases — Gates Foundation puts $150 million behind coronavirus vaccine production.
46 mins ago - Health

Indoor air is the next coronavirus frontline

Illustration: Eniola Odetunde/Axios

A growing body of research has made it clear that airborne transmission of the coronavirus is possible.

Why it matters: That fact means indoor spaces can become hot spots. Those spaces also happen to be where most business and schooling takes place, so any hope for a return to normality will require better ways of filtering indoor air.

The silver linings of online school

Illustration: Annelise Capossela/Axios

Online learning can be frustrating for students, teachers and parents, but some methods are working.

The big picture: Just as companies are using this era of telework to try new things, some principals, teachers and education startups are treating remote learning as a period of experimentation, too.