The U.S. Treasury yield curve is simply a snapshot of the interest rate the government pays to borrow money across different lengths of time — from 1-month and 3-month bills, out through 2-, 5-, and 10-year notes, all the way to the 30-year bond. Plot the yield for each maturity and connect the dots, and you get a curve.

Under normal conditions the curve slopes upward: lenders demand a higher yield to tie their money up for thirty years than for three months, because more can go wrong over a longer horizon. The steepness of that slope is one of the cleanest real-time reads on what the bond market expects from growth, inflation, and the Federal Reserve.

When you scrub the timeline above, you are watching that curve breathe — steepening when policy is easy and growth is expected, flattening and then inverting when the Fed tightens and investors brace for a slowdown.

An inverted yield curve — where short-term yields rise above long-term yields — is the bond market's most famous recession warning. It happens when the Fed pushes short rates high to fight inflation while investors, expecting those rates to be cut later, keep long-term yields lower.

The single most-watched measure is the 2s10s spread: the 10-year yield minus the 2-year yield. When it falls below zero, the curve is inverted. A sustained 2s10s inversion has preceded every U.S. recession since the 1970s — usually by somewhere between 12 and 24 months. It is not a stopwatch, and it has produced false alarms, but as a single indicator its track record is hard to ignore.

On the timeline, the scrubber is tinted by the 2s10s spread, and the shaded bands mark official NBER recessions (1990–91, 2001, 2007–09, 2020). Line the two up and the lead-lag relationship between inversion and downturn becomes something you can see rather than just read about. For a deeper dive, see our guides on what an inverted curve is and whether it predicts recessions.

• Curve shape — a steep curve reflects easy policy and growth expectations; a flat or inverted curve signals tightening and possible stress ahead.
• Fed policy band — the shaded band shows the Federal Reserve's target rate range, so you can see exactly where official policy sat as the curve moved.
• RRP usage — overnight reverse-repo activity tracks excess cash in the financial system. The 2021–2023 spike and unwind was historically unprecedented.
• Asset overlay — the second chart plots a stock index, gold, long Treasuries, or Bitcoin in sync with the curve, so you can watch how each asset behaved through a given rate cycle.

Macro doesn't happen in a vacuum, so the timeline pairs the curve with a price chart you can switch between several markets: the S&P 500 and Nasdaq 100 for large-cap equities, the Russell 2000 for small caps, gold, the TLT long-Treasury ETF, and Bitcoin. Both charts share one playhead, so pausing on, say, the deep 2022–2023 inversion shows you precisely what equities were doing at that moment.

Curious how a single market compounded over decades? The growth scenarios work out what $1,000 invested in each of these markets at various starting years would be worth today, with the exact dates and an honest, price-return-only breakdown of the math.

The ✨ Insights button on the yield chart generates a short macro "field note" for any point on the timeline. It reads the current curve regime, the selected asset, and historical percentiles, then writes a structured interpretation of what the bond market was signaling and whether equities or commodities agreed. The model sees only market data — no personal information — and its output is a research aid, not investment advice.

Does an inverted yield curve guarantee a recession?

No. It is a strong historical signal, not a certainty. The 2s10s inversion has preceded every U.S. recession since the 1970s, but the lead time varies widely and there have been false signals. Treat it as one important input among many, not a prediction.

What is the 2s10s spread?

It's the 10-year Treasury yield minus the 2-year Treasury yield. A positive spread means the curve slopes up normally; a negative spread means it's inverted. It's the most commonly cited single gauge of curve shape.

Where does the data come from?

Yields come from the U.S. Department of the Treasury, the Fed policy band from the Federal Reserve's H.15 release, reverse-repo figures from the New York Fed, recession dates from the NBER, and asset prices from public market data. Full sources are on the about page.

Is YieldCurve AI free?

Yes. It's a free educational tool built by Correia Investments, LLC. Nothing on the site is investment advice or a recommendation to buy or sell any security.