Term Spreads and Economic Policy Uncertainty

In August, an elevated economic policy uncertainty index was associated with an increasingly inverted yield curve. The measured Economic Policy Uncertainty (EPU) index as of today is 582 (sure to be revised, but still…).

Buckle up!

Figure 1: Treasury 10yr-3mo term spread (blue, left scale), 10yr-2yr (red, left scale), and 5yr-3mo (teal, left scale), all in %; and Economic Policy Uncertainty (EPU) index (black, right scale). Source: Federal Reserve via FRED, Treasury, and policyuncertainty.com, accessed 9/29.

12 thoughts on “Term Spreads and Economic Policy Uncertainty

  1. Bruce Hall

    Meanwhile, income inequality is the main focus for Sanders and Warren. The new ACS survey reveals that:
    The Gini index for the United States in the 2018 ACS (0.485) was significantly higher than the 2017 ACS estimate. Five states (California, Connecticut, Florida, Louisiana and New York), the District of Columbia and Puerto Rico had Gini indices higher than the United States, and 36 states were lower. . https://www.census.gov/newsroom/press-releases/2019/acs-1year.html

    Special focus for corrective action will be on Florida because it has a Republican governor.

    1. pgl

      Awww Brucie? People are interested in income inequality. Those COMMIES. Yea – we know you are a “let them eat cake” kind of dude. More tax cuts for the rich. End Social Security and Federal health care as we know it! In fact, I bet you want to repeal the 19th amendment!

    2. pgl

      Lord – Bruce Hall must have flunked pre-K reading. From his own link:

      “From 2017 to 2018, the poverty rate declined in 14 states and Puerto Rico. In 2018, the poverty rate increased in only one state: Connecticut. California, Florida, Georgia and North Carolina had declining poverty rates for the fifth year in a row. In three states (Arizona, Illinois and New York), poverty declined for a fourth consecutive year.”

      So in most of those states where Brucie the incompetent said there was a problem, the problem is being resolved. Now poverty did rise a few states – mostly red states.

      Come on Bruce – if you sign up for remedial reading skills, we’ll pay for it as your comments have a tendency of being either really dumb or down right dishonest.

  2. 2slugbaits

    And this morning we learn that the ISM’s purchasing index tanked bigtime and fell to the lowest level since March 2009. Of course, President Don “Corleone” Trump blames it all on the Fed. I’m sure the economics geniuses over at Fox Business will fall in line and agree with Trump.

  3. baffling

    funny how it is never the don’s fault when things go bad. dysfunctional trade policy and weird economic incentives are not causing poor economic growth. it must be the feds fault! the don never found a problem he couldn’t blame on somebody else.

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