Over the past week, 10-Year Treasury rates increased by 1bp, bringing the net change over the last two weeks to an increase of 32bp.

The red line represents current rates, while the green line reflects rates from one week ago. While short-term rates have decreased, long-term rates have risen. For maturities of 1 year and beyond, the yield curve now displays a positive slope.

As the Federal Reserve continues to lower its Fed Funds rate, short-term rates are expected to decrease further, gradually restoring the yield curve to its typical upward slope.

This positive slope in the yield curve is being achieved through a combination of Fed action on short-term rates and market-driven demand for higher long-term rates.

Bill Knudson, Research Analyst LANDCO NEXA