Asked by math
                What does the shape of a treasury bond yield curve tell you about expected future inflation?
            
            
        Answers
                    Answered by
            drwls
            
    Inflation is expected to be high in the distant future if long term (10 to 30 year) loan rates are much higher than short term rates (6 months to two years). Long term rates are usually only a few percent higher. Sometimes long term rates are lower, if the Federal Reserve is acting to cool off an overheated economy or speculative stock market by raising short term rates. 
    
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