10-Year vs 2-Year Treasury Yield
When 2-year yields exceed 10-year yields the curve is inverted — and inversions have preceded every U.S. recession since 1955. Compare the two benchmark yields directly.
- 10-Year Yield
- 2-Year Yield
The 2-year Treasury yield tracks short-term Fed policy expectations; the 10-year yield reflects longer-run growth and inflation expectations plus a term premium. When the market expects the Fed to cut rates (usually because growth is slowing), 10-year yields fall below 2-year yields and the curve inverts.
The 2022–24 inversion was the deepest and longest since the early 1980s. The recession it implied hasn't arrived on the historical schedule — a point of active debate among forecasters. Explanations range from quantitative tightening mechanics to labor-market tightness that has delayed demand destruction.
FRED publishes a convenience series (T10Y2Y) that subtracts the 2-year from the 10-year so you can chart the spread directly. Comparing the two yields side by side shows the underlying moves — whether an inversion is driven by rising short rates (a hawkish Fed), falling long rates (softening growth expectations), or both.
Frequently asked questions
How long before a recession does the 10y–2y curve typically invert?
Historically the curve has inverted 6 to 24 months before the start of a recession. The 2006 inversion led the 2008 recession by about 18 months; the 2000 inversion led the 2001 recession by about 10 months.
Is the yield curve a perfect recession predictor?
Close, but not perfect. The 10y–2y curve has inverted before every U.S. recession since 1955 with only one false positive (1966). The current cycle is testing whether that track record holds after an unprecedented fiscal and monetary response to COVID.
Learn more
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