SKF - The yield curve flattens further; how can investors capitalize?

Melpomenem/iStock via Getty Images The yield curve continues to flatten between the spread of the U.S. 10-Year Treasury Note and the U.S. 2-Year Treasury Note. The spread has slipped down to 1.09 from 1.58 or 49 basis points. Traditionally, when the yield curve flattens or falls, the gap between shorter-term and longer-term debt yield differentials becomes tighter. This can be a possible indication of economic uncertainty and anticipation of tighter monetary policy. Below is a chart depicting the yield curve spread between the U.S. 10-Year and 2-Year since 1999. Investors will see that recently, since Q3 of 2019, the yield curve began steepening and really took off in Q1 of 2021 before reversing and starting to flatten in Q2 of 2021. Market participants are continuing to watch the yields on the U.S. 10-Year Treasury as it has dipped five basis points and below the 1.3% level down to as low

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The yield curve flattens further; how can investors capitalize?