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Jan. 27, 2022, 11:25 a.m. EST

Treasury yield curve flattens to levels not seen since 2019-2020 after Fed's policy update

The Treasury yield curve, often regarded as an indicator of investor outlook on the U.S. economy, continued to flatten on Thursday to levels not seen in years following the Fed's policy update in the prior session. The spread between 2-year and 10-year yields shrunk to 62.7 basis points, the flattest level since November 2020, according to data provided by Tradeweb as of 11 a.m. Eastern time. Meanwhile, the gap between 5- and 30-year yields narrowed to 43.6 basis points, the flattest since January 2019. The shrinking spreads suggest that investors don't think Federal Reserve officials can raise interest rates as much as they'd like, without damaging economic growth.

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