Is it finally here? Has the latest round of poor ISM economic releases unleashed the long awaited it’s-too-obvious-to-ignore slowdown the bond bulls were pining for? The market certainly thinks so. Have a look at the US 2-10 yield curve spread: In late September we were threatening inversion, but the last couple of poor ISM economic releases has steepened the yield curve by almost 15 basis points. That’s not crazy by any means, but it signals the market expects the Fed to chase the front end down.

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