Bond market hangover: Investors must 'ignore the noise'

Does not signal recession

Lauren Mason
clock • 4 min read

The recent yield curve inversion of the US bond market does not mean the writing is on the wall for a recession, according to several industry commentators, who believe a “complex range of circumstances” have led to unusual market movements.

On Tuesday evening (29 March), the yield on two-year Treasuries temporarily exceeded that of ten-year US government bonds, which suggests shorter-term investments in the asset class are perceived as higher risk than longer-term ones. The last time this happened was in September 2019, approximately 18 months before the last economic recession. In fact, during each of the six recessions experienced over the last 40 years, the difference between ten-year and two-year Treasury yields - the two-ten year yield curve - has reliably inverted approximately 1.5 years before GDP has turned negat...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Investment

Why investors need to think about emerging markets a little differently

Why investors need to think about emerging markets a little differently

'Emerging markets are starting to look eerily similar to developed'

James Flintoft
clock 29 October 2025 • 3 min read
Watch PA's Working Lunch with Baillie Gifford: Acting your age – when growing up pays off

Watch PA's Working Lunch with Baillie Gifford: Acting your age – when growing up pays off

Catch up on the discussion

Professional Adviser
clock 29 October 2025 • 1 min read
Direct engagement and the search for hidden gems

Direct engagement and the search for hidden gems

'What really matters is that investors do not find themselves behind the eight ball'

Gabriel Sacks
clock 27 October 2025 • 4 min read