Global Forex and Fixed Income Roundup

The latest Market Talks covering FX and Fixed Income. Published exclusively on Dow Jones Newswires throughout the day.

A widening gap between short- and long-term Treasury yields is an indication that recession fears are increasing again, Spartan’s Peter Cardillo says. The 10-year today fell 0.050 percentage point to 4.121% and the two-year rose 0.026 pp to 4.601%. The inverted spread reached 0.480 pp, the widest since September. It is often seen as a sign markets are pricing a recession driven by high interest rates. Cardillo says indications that labor costs are falling have triggered the widening. “This is actually the opposite that’s been recently happening,” as the inverted spread had been shrinking. Weekly jobless claims tomorrow and payrolls Friday are likely to impact yields.