Yield Curve 10Y-2Y

Yield curve

+0.37 ptsOct 14, 2026Score 7/10 · Caution

The 10-year yields 0.37 pts more than the 2-year. It was inverted from Jul 2022 to Sep 2024; it inverted before each of the last six recessions. Against the 3-month bill: +0.91 pts.

The 10-year yield minus the 2-year and minus the 3-month bill (the curve the New York Fed uses for its recession probability). Normally the long bond pays more. When the short one pays more (inverted curve), markets expect the Fed to cut rates because of a recession. The worse of the two rules.

Source: Fed de St. Louis (T10Y2Y, T10Y3M) · FRED T10Y2Y

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Money tab score

8/10Healthy

average 7.83

After inflation, the Fed's rate is +0.9%, near neutral. The long end is moving: the 10-year is up 1.16 pts over a year.

The 3 blocks

Price of moneyExpensive or cheap?7.5 Yield curveIs it flagging a recession?7.0 Quantity of moneyIs it growing at the right pace?9.0

What would turn it red

The 10-year rising more than 1.5 pts in a year (today +1.16) or falling more than 1.5: the first makes everything pricier at once, the second usually signals recession fear.
Either curve inverting, even slightly: the 10-year paying less than the 2-year (today +0.37) or than the 3-month bill (today +0.91).
The Fed's rate after inflation moving more than 3 pts from neutral, above (as in 1981) or below (as in 2022). Today: +0.9%.
Half of the eight indicators red at once. Today: none.

The score is the number of bars lit: 10 is healthiest and 1 is worst. The orange spark marks where it is today.

Yield Curve 10Y-2Y

-0.05

pp

-0.14

pp

+0.05

pp

-0.05

pp

-0.16

pp

-0.18

pp

Last

0.37 pp

0.42 pp

All-time: -2.4 – 2.9 pp · since Jun 76 · now at 52% of that range

Yield Curve 10Y-2Y stands at 0.37pp (Oct 14, 2026), down from 0.42pp on Oct 13, 2026. Since Oct 14, 2025 it has moved -0.18 pp.

Loading chart…

Y axis zoomed to the selected range, so week-to-week moves are visible. It does not start at zero.

Source: FRED (Federal Reserve Bank of St. Louis)

Sort:

IndicatorLastPreviousChangeHighestLowestRange %GaugeDate

Fed Interest Rate %440% · 1D5.50.271%—Oct 26

10Y Treasury Yield %5.215.24-0.03% · 1D15.80.531%—Oct 26

Money Supply M2 $B23,342.823,217.9+124.9+0.5% · 1M23,342.8286.6100%—Aug 26

Money Supply M1 $B▲ 202219,991.119,886.5+104.6+0.5% · 1M20,750.4138.996%—Aug 26

Monetary Base (M0) $B5,411.65,523.9-112.3-2.0% · 1M6,413.148.484%—Aug 26

2Y Treasury Yield %4.794.8-0.01% · 1D16.90.128%—Oct 26

30Y Treasury Yield %5.565.6-0.04% · 1D15.2132%—Oct 26

Yield Curve 10Y-2Y pp0.370.42-0.05pp · 1D2.9-2.452%—Oct 26

Real 10Y Yield %2.882.91-0.03% · 1D3.1-1.294%—Oct 26

Yield Curve 10Y-3M pp0.910.95-0.04pp · 1D5.2-1.940%—Oct 26

The 8 indicators

Price of money: Expensive or cheap?

average 7.5 · Caution

Fed rate

Fed Interest Rate

10/10Healthy

4.00%top of range · Oct 13, 2026: effective 3.88% − inflation 3.0% = real +0.9%

After inflation, the Fed's rate is +0.9%, near neutral (about 1%): neither braking nor pushing the economy.

See scale and last 10 years

The Fed's policy rate minus core inflation. Healthy is near the neutral rate, about 1% real. Far above brakes the economy; far below feeds inflation.

Measures: Effective fed funds minus core PCE inflation (%).

Oct 2016last 10 yearsOct 2026

Score	Above	Below
10	1.0 to 1.5	0.5 to 0.9
9	1.6 to 2.0	0.0 to 0.4
8	2.1 to 2.5	−0.5 to −0.1
7	2.6 to 3.0	−1.0 to −0.6
6	3.1 to 3.5	−1.5 to −1.1
5	3.6 to 4.0	−2.0 to −1.6
4	4.1 to 4.8	−2.8 to −2.1
3	4.8 to 5.5	−3.5 to −2.9
2	5.6 to 6.5	−4.5 to −3.6
1	more than 6.5	less than −4.5

Fed (DFEDTARU, DFF) y BEA (PCEPILFE) · FRED

2-year Treasury

2Y Treasury Yield

9/10Healthy▲ above normal

4.79%Oct 13, 2026 · +0.91 pts vs. the Fed's rate

The 2-year note yields 4.79%, 0.91 pts above the Fed's rate: markets expect more hikes.

See scale and last 10 years

The 2-year note tracks what markets expect the Fed to do. Well above the Fed's rate means hikes are expected; well below means cuts, which usually come with a recession.

Measures: 2-year yield minus effective fed funds (pts; normal is +0.4).

Oct 2016last 10 yearsOct 2026

Score	Above	Below
10	0.40 to 0.70	0.10 to 0.39
9	0.71 to 1.00	−0.10 to 0.09
8	1.01 to 1.30	−0.30 to −0.11
7	1.31 to 1.60	−0.50 to −0.31
6	1.61 to 1.90	−0.70 to −0.51
5	1.91 to 2.20	−0.90 to −0.71
4	2.21 to 2.60	−1.20 to −0.91
3	2.61 to 3.10	−1.60 to −1.21
2	3.11 to 3.70	−2.10 to −1.61
1	more than 3.70	less than −2.10

Tesoro vía Fed (DGS2, DFF) · FRED

10-year Treasury

10Y Treasury Yield

6/10Caution▲ above normal

5.21%Oct 13, 2026 · +1.16 pts over a year

The 10-year yields 5.21%, 1.16 pts higher than a year ago, the highest since Jun 2007.

See scale and last 10 years

The benchmark for mortgages, corporate loans and stock valuations. Speed is what hurts: a big rise in a year makes everything pricier at once; a big drop usually signals recession fear.

Measures: Change in the 10-year yield over a year (pts).

Oct 2016last 10 yearsOct 2026

Score	Above	Below
10	0.00 to 0.30	−0.30 to −0.01
9	0.31 to 0.50	−0.50 to −0.31
8	0.51 to 0.75	−0.75 to −0.51
7	0.76 to 1.00	−1.00 to −0.76
6	1.01 to 1.25	−1.25 to −1.01
5	1.26 to 1.50	−1.50 to −1.26
4	1.51 to 1.90	−1.90 to −1.51
3	1.91 to 2.40	−2.40 to −1.91
2	2.41 to 3.20	−3.20 to −2.41
1	more than 3.20	less than −3.20

Tesoro vía Fed (DGS10) · FRED

Real long-term cost of money

30Y Treasury Yield

5/10Caution▲ above normal

5.56%Oct 13, 2026 · real +2.6% · TIPS 2.88%

The 30-year yields 5.56%, the highest since Jun 2004. After inflation that is 2.6%, below the 1990–2019 average (3.1%). The 10-year TIPS pays 2.88% real (normal is 1%).

See scale and last 10 years

The cost of long-term borrowing after inflation, in two readings: the 30-year minus core inflation and the inflation-protected 10-year (TIPS). The worse one rules. The 30-year averaged about 3.1% real in 1990–2019; TIPS, 1%. Much more makes debt and mortgages pricier; much less, as in 2020–2022, inflates home and stock prices.

Measures: The worse of two: 30-year yield minus core PCE inflation, and 10-year TIPS (%).

Oct 2016last 10 yearsOct 2026

Score	30-year minus core inflation · Above	30-year minus core inflation · Below	10-year real yield (TIPS) · Above	10-year real yield (TIPS) · Below
10	3.1 to 3.6	2.6 to 3.0	1.00 to 1.40	0.60 to 0.99
9	3.7 to 4.1	2.1 to 2.5	1.41 to 1.80	0.20 to 0.59
8	4.2 to 4.6	1.6 to 2.0	1.81 to 2.10	−0.10 to 0.19
7	4.7 to 5.1	1.1 to 1.5	2.11 to 2.40	−0.40 to −0.11
6	5.2 to 5.6	0.6 to 1.0	2.41 to 2.70	−0.70 to −0.41
5	5.7 to 6.1	0.1 to 0.5	2.71 to 3.00	−1.00 to −0.71
4	6.2 to 6.8	−0.6 to 0.0	3.01 to 3.40	−1.40 to −1.01
3	6.9 to 7.6	−1.4 to −0.7	3.41 to 3.90	−1.90 to −1.41
2	7.7 to 8.6	−2.4 to −1.5	3.91 to 4.50	−2.50 to −1.91
1	more than 8.6	less than −2.4	more than 4.50	less than −2.50

30-year minus core inflation: 2.6 → 10 · 10-year real yield (TIPS): 2.88 → 5. The worse one rules.

Tesoro vía Fed (DGS30, DFII10) y BEA (PCEPILFE) · FRED

Yield curve: Is it flagging a recession?

average 7.0 · Caution

Yield curve

Yield Curve 10Y-2Y

7/10Caution

+0.37 ptsOct 14, 2026 · 10y − 3m +0.91

The 10-year yields 0.37 pts more than the 2-year. It was inverted from Jul 2022 to Sep 2024; it inverted before each of the last six recessions. Against the 3-month bill: +0.91 pts.

See scale and last 10 years

Measures: The worse of two curves: 10y − 2y and 10y − 3m (pts).

Oct 2016last 10 yearsOct 2026

Score	10y − 2y	10y − 3m
10	1.00 or more	1.50 or more
9	0.75 to 0.99	1.00 to 1.49
8	0.50 to 0.74	0.75 to 0.99
7	0.25 to 0.49	0.50 to 0.74
6	0.10 to 0.24	0.25 to 0.49
5	0.00 to 0.09	0.00 to 0.24
4	−0.25 to −0.01	−0.25 to −0.01
3	−0.50 to −0.26	−0.50 to −0.26
2	−1.00 to −0.51	−1.00 to −0.51
1	less than −1.00	less than −1.00

10y − 2y: 0.37 → 7 · 10y − 3m: 0.91 → 8. The worse one rules.

Fed de St. Louis (T10Y2Y, T10Y3M) · FRED

Quantity of money: Is it growing at the right pace?

average 9.0 · Healthy

Money supply M2

Money Supply M2

10/10Healthy

+5.7% over a year$23.34T in Aug 2026

Money held by the public (M2) is up 5.7% from a year ago, in line with what the economy grows with normal inflation (5.5%).

See scale and last 10 years

All money held by the public: cash, checking, savings and money-market funds. Healthy is growing roughly like the economy with normal inflation, about 5.5% a year. In 2020–21 it grew as much as 27% in a year and inflation followed; in late 2022–2023 it fell for the first time since records began (1959).

Measures: M2 vs. a year ago (%).

Sep 2016last 10 yearsAug 2026

Score	Above	Below
10	5.5 to 7.5	4.0 to 5.4
9	7.6 to 9.0	2.5 to 3.9
8	9.1 to 10.5	1.5 to 2.4
7	10.6 to 12.0	0.5 to 1.4
6	12.1 to 13.5	−0.5 to 0.4
5	13.6 to 15.5	−1.5 to −0.6
4	15.6 to 18.5	−2.5 to −1.6
3	18.6 to 22.5	−3.5 to −2.6
2	22.6 to 27.5	−5.5 to −3.6
1	more than 27.5	less than −5.5

Fed (M2SL) · FRED

Money supply M1

Money Supply M1

10/10Healthy

+6.1% over a year$19.99T in Aug 2026

The most liquid money (M1) is up 6.1% from a year ago, in line with what the economy grows with normal inflation (5.5%).

See scale and last 10 years

The most liquid money: cash and spendable deposits. In May 2020 the Fed added savings accounts and the level tripled; that jump is excluded.

Measures: M1 vs. a year ago (%).

Sep 2016last 10 yearsAug 2026

Score	Above	Below
10	5.5 to 7.5	4.0 to 5.4
9	7.6 to 9.0	2.5 to 3.9
8	9.1 to 10.5	1.5 to 2.4
7	10.6 to 12.0	0.5 to 1.4
6	12.1 to 13.5	−0.5 to 0.4
5	13.6 to 15.5	−1.5 to −0.6
4	15.6 to 18.5	−2.5 to −1.6
3	18.6 to 22.5	−3.5 to −2.6
2	22.6 to 27.5	−5.5 to −3.6
1	more than 27.5	less than −5.5

Fed (M1SL) · FRED

Monetary base

Monetary Base (M0)

7/10Caution▼ below normal

−4.8% over a year$5.41T in Aug 2026

The monetary base (cash plus bank reserves at the Fed) is down 4.8% from a year ago: the Fed is shrinking its balance sheet.

See scale and last 10 years

Cash in circulation plus bank reserves at the Fed. It rises when the Fed buys bonds (QE) and falls when it lets them run off (QT).

Measures: Monetary base vs. a year ago (%).

Sep 2016last 10 yearsAug 2026

Score	Above	Below
10	4.5 to 9.5	1.5 to 4.4
9	9.6 to 14.5	−1.5 to 1.4
8	14.6 to 19.5	−4.5 to −1.6
7	19.6 to 24.5	−6.5 to −4.6
6	24.6 to 29.5	−8.5 to −6.6
5	29.6 to 39.5	−10.5 to −8.6
4	39.6 to 54.5	−13.5 to −10.6
3	54.6 to 74.5	−17.5 to −13.6
2	74.6 to 104.5	−23.5 to −17.6
1	more than 104.5	less than −23.5

Fed (BOGMBASE) · FRED

If this gauge had existed since 1963

Each month's score, with today's rules and thresholds. There is no 2-year note or curve until 1976, the curve against the 3-month bill starts in 1982 and the 10-year real yield in 2003: the score uses the indicators available (at least half). Gray bands are recessions.

A1980–81 · Volcker raises the Fed rate to 19%: 13% after inflation, the most expensive money on record
B2008 · the Fed cuts rates to zero and starts buying bonds
C2020–21 · money held by the public (M2) grows 27% in a year
D2022 · with inflation at 9% and the Fed rate near zero, money costs −5% after inflation; then the 10-year rises 2.8 pts in a year
EToday · score 8: after inflation, the fed's rate is +0

How it is calculated

The rules

Each indicator scores 1 to 10 from its table. Most are two-sided: money too expensive is as bad as money too cheap. The yield curve only counts downward, when it inverts.
Each block is the average of its indicators and the score is the average of the three blocks, rounded (0.5 rounds down).
If half or more of the indicators are red, the score is at most 4.
An indicator without data is left out of the average.

Deliberate choices

Rates are measured net of core PCE inflation with a two-month lag: what was known at each date.
The Fed's rate is compared with the neutral rate, usually estimated at about 1% real.
For the 10-year, speed matters more than level: its gauge measures the change over a year.
What is measured twice goes in as two readings of the same gauge, and the worse one rules: the two curves (against the 2-year and against the 3-month bill, the one the New York Fed uses for its recession model) and the two long-term real rates (30-year minus core inflation and the 10-year TIPS). Each has its own row in the table.
M1 was redefined in May 2020: that year's jump is excluded.
It describes the price and quantity of money from the latest data. It does not forecast prices and is not a buy or sell signal.

Sources: Federal Reserve (Fed rate, M1, M2, monetary base), US Treasury (yields, bills and TIPS, via the Fed), St. Louis Fed (curves) and BEA (PCE inflation), via FRED. Recessions: NBER. Not investment advice.