What is a flattening yield curve?

This phenomenon occurs when the interest rate for bonds with different maturities comes closer and closer together, resulting in a flat or near-flat yield curve. This means there is little difference between the short-term and long-term interest rates for bonds of comparable quality. A flattening yield curve can have various causes, such as decreasing inflation expectations or the expectation of slower economic growth.

It is an important indicator for financial markets, as it is often seen as a signal that the economy may be slowing down.

In the financial world, this is often referred to as a flattening yield curve in English. It can also be a precursor to an inverted yield curve, which is sometimes regarded as an indication of an impending recession.