The Federal Reserve's favorite recession indicator is flashing a danger sign again

The Federal Reserve is concerned about a possible recession as the 10-year Treasury yield fell below the 3-month note, creating an “inverted yield curve,” known for predicting downturns. This indicator has been reliable over the years, with the New York Fed providing updates on the relationship and recession probabilities. The recent shift in the yield curve suggests a higher likelihood of a recession, as it anticipates future Fed rate cuts in response to an economic slowdown.

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