The yield curve has steepened since the end of July, with long rates increasing about 20 basis point (b.p.) and the 3-month short rate inching up only four b.p. The closely watched spreads - the 3-year, 3-month and the 10-year, 3-month - have widened to 85 b.p. and 110 b.p., respectively, straddling their average values of 80 and 120. This suggests that the economy will grow at an average rate over the next four quarters.
Suggested citation: “Interest Rates,” Federal Reserve Bank of Cleveland, Economic Trends, no. 97-09, pp. 06, 09.01.1997.