NEW YORK, Feb. 10 (UPI) -- The U.S. bond market sent a powerful signal Friday that the nation's economy is headed for a recession.
The interest rates payable on government debt securities typically are higher on longer-maturity securities, as a way to reward investors for letting the government have access to their money for a longer time period.
But Friday afternoon the interest rates payable on government debt securities that mature from 6 months to 10 years exceeded the interest rates payable on 30-year government debt securities.
That phenomenon, known as an inverted yield curve, often predicts an imminent recession.
Whether that is what the bond market is actually signaling was a subject of intense debate Friday among members of the financial and business communities.
Among those insisting that an inverted yield curve does not, in this case, signal a recession is former Federal Reserve Chairman Alan Greenspan.
