Yield Curve (2Y–3M)

2-Year Treasury yield minus 3-Month T-Bill yield — the NY Fed's preferred recession predictor. Every US recession since 1966 has been preceded by an inversion of this spread. The current cycle saw a record inversion below -150bps in 2023, the deepest since 1981. Re-steepening via rate cuts is underway, but historically the recession often arrives as the curve normalises, not while it remains inverted.

This indicator is computed by MacroLab from two FRED series: DGS2 minus DGS3MO. Both input series are sourced from the Federal Reserve Economic Data (FRED) database.