New York Federal Reserve President John Williams, addressing a key market concern about the future, said the move of near-term bond yields above their longer-duration counterparts is only one consideration when determining what the economy will look like in the future.
The inverted yield curve is not “an oracle,” he said Thursday during a question-and-answer session with CNBC’s Steve Liesman.
Previous occurrences have been reliable recession indicators, particularly when the three-month Treasury yield rises above the benchmark 10-year note.
“I don’t go it like an oracle: ‘Tell me the answer, will there be a recession?'” Williams said following a speech he delivered in New York to the Council on Foreign Relations. “I think it’s like other market indicators. It’s telling us that there’s heightened concerns about the risks on the outlook.”
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