A steep yield curve may be an indicator of
A)expectations of a significant increase in inflation.
B)an upcoming recession.
C)an economic slowdown.
D)lower future short-term interest rates.

Question

Quizplus · Accepted Answer

A steep yield curve suggests that investors expect higher inflation in the future, leading to higher long-term interest rates. This can be seen as a sign of economic growth, but also a risk of inflation.

A Steep Yield Curve May Be an Indicator of