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    Interest Rates: Yield Curve Flattening Yield Curve Flattening

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    Nishtha Kaushik
    The yield curve has flattened for the first time since August 2019, which can signal slowing global growth especially with the recent coronavirus outbreak. The federal budget currently stands at its highest level in history at $4.74 trillion, making up 30% of GDP, with mandatory spending like Medicare and Social Security accounting for $2.84 trillion of the FY2020 budget. Trump has proposed a FY2021 budget of $4.8 trillion with changes to programs like Medicaid, defense and others that Congress will vote on this year.

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    Interest Rates: Yield Curve Flattening Yield Curve Flattening

    Uploaded by

    Nishtha Kaushik
    17 views2 pages
    The yield curve has flattened for the first time since August 2019, which can signal slowing global growth especially with the recent coronavirus outbreak. The federal budget currently stands at its highest level in history at $4.74 trillion, making up 30% of GDP, with mandatory spending like Medicare and Social Security accounting for $2.84 trillion of the FY2020 budget. Trump has proposed a FY2021 budget of $4.8 trillion with changes to programs like Medicaid, defense and others that Congress will vote on this year.

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    The yield curve has flattened for the first time since August 2019, which can signal slowing global growth especially with the recent coronavirus outbreak. The federal budget currently stands at its highest level in history at $4.74 trillion, making up 30% of GDP, with mandatory spending like Medicare and Social Security accounting for $2.84 trillion of the FY2020 budget. Trump has proposed a FY2021 budget of $4.8 trillion with changes to programs like Medicaid, defense and others that Congress will vote on this year.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    17 views2 pages

    Interest Rates: Yield Curve Flattening Yield Curve Flattening

    Uploaded by

    Nishtha Kaushik
    The yield curve has flattened for the first time since August 2019, which can signal slowing global growth especially with the recent coronavirus outbreak. The federal budget currently stands at its highest level in history at $4.74 trillion, making up 30% of GDP, with mandatory spending like Medicare and Social Security accounting for $2.84 trillion of the FY2020 budget. Trump has proposed a FY2021 budget of $4.8 trillion with changes to programs like Medicaid, defense and others that Congress will vote on this year.

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    Interest Rates

    Yield Curve Flattening Yield Curve Flattening


    2.5%
    • Yield curve flattening for first time since August 2019,
    2.0%

    • Sign of global growth, especially with recent


    1.5%
    Coronavirus outbreak
    1.0%
    • August rates saw flattening due to worries of US
    0.5%
    Economy slowdown
    0.0%
    1 Mo 2 Mo 3 Mo 6 Mo 1 Yr 2 Yr 3 Yr 5 Yr 7 Yr 10 Yr 20 Yr 30 Yr

    2/10/2020 1/2/2020 8/12/2019

    Yield Spread Trending Towards 0


    5.0%

    4.0%

    3.0%

    2.0% -2 BPS
    1.0%

    0.0%

    -1.0%

    -2.0%
    2002 2005 2008 2011 2014 2017 2020
    Government Spending
    Recent Spending Activity US Federal Budget Currently Highest in History
    $5.0 $4.74T 30%
    • Fed budget makes up 21% of US GDP $4.5
    25%
    $4.0

    • Mandatory spending (Medicare and Social $3.5


    20%
    $3.0

    USD ($T)
    Security) make up $2.84T of FY2020 budget $2.5 15%
    $2.0

    • Recently, Trump proposed FY2021 budget of $1.5


    10%

    $1.0
    $4.8T $0.5
    5%

    • Alterations to Medicaid, Defense and many $0.0


    2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
    0%

    other programs US Federal Budget % of GDP

    • Will be voted on in Congress early this year Budget Breakdown by Function


    Other Medicare
    20% 18%

    Income Security
    9% Social Security
    17%

    Net Interest
    9%

    Health National Defense


    11% 16%

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