Does an Inverted Yield Curve Lead to a Recession?
David Kass, a finance professor at the University of Maryland, cautioned
that the yield curve may not be an accurate predictor of a recession
under current conditions
Kass said negative bond yields in Europe, in which investors receive
nothing for their money, may be pushing investors into U.S. Treasurys.
investors may be buying long-term U.S. Treasurys in order to earn a
positive return,” Kass said. “This would exert downward pressure on the
yield of long-term U.S. Treasury securities.”
Yellen and others also share view trusting the yield curve inversion as the a recession indicator