The two-year U.S. Treasury yield reached 4.167% on Friday. The treasury yield hit 3.762% on the 10 year U.S. This allows the yield curve to remain in an inverse relationship, which typically points to a recession.
The spread between the dividend yields and bond yields has widened the most in the past twelve years and is pointing higher, as Federal Reserve policy remains hawkish, according to True Insights. As investors look for high yields to protect their portfolios to get passive income, more investors may turn to bond markets, as the dividend yield for equities is not up to par. Since these exchange-traded funds are focused on high yields, an investor does not have to turn to the risk-free rate.
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