Money and Financial Markets
The yield curve’s upward slope suggests that liquidity is adequate for economic expansion. Moreover, the recent increase in the curve’s steepness reverses a disconcerting trend. In light of the historically low levels of both long- and short-term interest rates at present, the slope of the yield curve is consistent with the Federal Open Market Committee’s (FOMC) view that monetary policy is accommodative and sufficient to engender better conditions should uncertainty diminish in the near term.
Suggested citation: "Money and Financial Markets," Federal Reserve Bank of Cleveland, Economic Trends, no. 03-04, pp. 05-07, 04.01.2003.