Market pros track the spread between longer-duration Treasury yields and shorter-duration yields, with the former typically higher.
However, the 2-year Treasury yield climbed 15 basis points to 2.967% on Wednesday, holding above the 10-year. That so-called inversion, particularly if sustained, is often interpreted as a warning sign that the economy may be weakening, and a recession could be on the horizon.
The 2-year to 10-year curve first inverted on March 31, then again briefly in June.
Treasury yields pushed higher on Thursday after moving higher in the previous session on the release of the latest Federal Reserve meeting minutes. The documents showed that the central bank was leaning toward another 75 basis point rate hike this month as it focuses on bringing down inflation.
Market participants have become increasingly concerned about the prospect of a recession as economic data has weakened, while the Federal Reserve has committed to aggressive monetary policy to tackle soaring inflation.
On the data front, initial jobless claims for the week ending July 2 will be released at 8:30 a.m. ET, with U.S. trade deficit figures for May scheduled to be published at the same time.
The Treasury will auction $35 billion in 4-week bills and $30 billion in 8-week bills on Thursday.
— CNBC’s Jesse Pound & Elliot Smith contributed to this report.
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