bond: US bond yield movement flags recession fears

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In the early cycle of yield inversion, the equity market tends to head southwards as investors prune their exposure to risky assets.

Synopsis

The difference between the 10- and 2-year treasury yields in the US, a widely-acknowledged recession indicator, is just 20 basis points away from turning negative. A year ago, this was 140 basis points on the positive side. The higher yield on 30-year US treasury bonds over the five-year paper shrank to just 12 basis points, the narrowest in 15 years.

ET Intelligence Group: Equity as an asset class, which has been under pressure after losing more than $12 trillion of market value globally this year, could witness more headwinds as recession indicators have started flashing warning signs.

The difference between the 10- and 2-year treasury yields in the US, a widely-acknowledged recession indicator, is just 20 basis points away from turning negative. A year ago, this was 140 basis points on

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