This Signal Triggered Before the Last 4 Recessions. It Just Happened Again.
The Motley Fool
by newsfeedback@fool.com (David Dierking)February 14, 2026
AI-Generated Deep Dive Summary
The U.S. Treasury yield curve has steepened again, signaling a potential shift in economic momentum that historically has been tied to recessions. This phenomenon, where shorter-term yields rise relative to longer-term ones, is often seen as a warning sign for investors and economists. The article highlights how this change could impact the economy and stock market, as an inverted yield curve—where short-term rates exceed long-term ones—has preceded the last four recessions. While the current situation isn't inverted, the steepening trend has traditionally been a cause for concern.
Despite strong GDP growth of 4.4% in the third quarter and a relatively stable unemployment rate between 4% to 5%, the broader economic picture remains mixed. Inflation is still above the Federal Reserve's target but below 3%, suggesting some stability. However, these figures don't fully capture the risks posed by the yield curve's behavior. Historically, an inverted or steepening yield curve has indicated that investors are pricing in expectations of slower growth or even contraction ahead.
For finance and investing professionals, understanding this signal is critical. While other economic indicators point to a healthy economy, the yield curve's shift serves as a reminder of potential risks on the horizon. Investors should be cautious and consider how this trend might influence their financial decisions.
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Originally published on The Motley Fool on 2/14/2026