Concerns about the flattening yield curve have been steadily growing since the Fed began raising rates. I have to admit I’ve begun to ignore most of the commentary as it isn’t very useful. I’m not suggesting it’s not important to be aware of what’s going on but I’m not sure how insightful or actionable most of the commentary is. Historical context is good but it doesn’t tell me what’s going to happen this time around.
Research Affiliates published what I consider to be an exceptional piece discussing the relationship between changes in the slope of the yield curve, trailing 6-month equity market returns and changes in phases within an economic cycle. It’s definitely worth the read.